Case Study: Company Refinances Debt to Fund Development of New Product Line

The initiative required expanding the business outside of the core offering, presenting both opportunity, and risk.

Background

After years of profitable growth, management spotted an opportunity to diversify the business and add options to the future revenue streams of the company.

The initiative required expanding the business outside of the core offering, presenting both opportunity, and risk.  After significant investment, and challenges brought on by the COVID 19 pandemic, the organization quickly recognized that additional capital would be necessary to execute the strategy.

Our Solution

The Business Development Company worked closely with company management and the existing bank to facilitate a $250,000 capital injection. The capital provided liquidity in the business, freeing up critical resources from the lender to ensure the necessary runway was in place to see the strategic plans through. 

Results

The additional capital, combined with refinancing support, enabled the company to cleanly spin off the new initiative, while providing the necessary capital to expand the existing core business. The funding provided management with flexibility within the business model to support the growth and revenue diversification strategy, while meeting the timing needs for capital at a crucial juncture in the organization’s development.