Supporting Technical Staffing for Infrastructure Projects

The challenge

The company had high customer concentration with a multinational engineering firm. Because of that concentration, traditional banks considered most of its accounts receivable ineligible.

The firm also faced a cash flow disconnect: payroll was paid weekly, while its engineering firm customer paid invoices on a once-per-month cycle.

It needed immediate working capital to staff a new large infrastructure project requiring 50 to 60 specialized consultants.

Why traditional financing was not a fit

The InterNex Capital solution

InterNex looked past the high concentration and legacy ineligible receivables to focus on the strength of the underlying technical services and the 15-year relationship between the firm's principals and its customer.

We provided a $2MM non-notified revolving line of credit that let the firm keep its direct relationship and billing reputation with its customer, without the notification requirements typical of factoring lenders.

• 100% concentration limit based on the investment-grade credit of the NYSE-listed customer
• Non-notified facility, so the customer's payment process did not change
• 85% advance rate against eligible commercial receivables, more availability than many asset-based lenders offer
• A credit decision based on business fundamentals rather than rigid ratios

The results

• Working capital to staff a new infrastructure project requiring 50 to 60 specialized consultants
• Weekly payroll funded despite a monthly customer payment cycle
• Direct relationship with its largest customer preserved

A smarter alternative

Technical staffing firms often depend on a small number of very large customers. Banks tend to treat that concentration as a reason to exclude receivables. InterNex looks at who the customer is: when it is investment grade and pays reliably, concentration can support a larger facility rather than a smaller one.

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