Factoring for Technology Companies

Factoring for Technology CompaniesFactoring for technology companies is becoming more popular, because many technology entrepreneurs won’t allow the lack of working capital to prevent them from growing. They look to Alabama and feel that they can do just as well.

Alibaba, the Chinese ecommerce firm, has just debuted on Wall Street, and it was a whopper. The technology company raised $29.7 billion, which made it the largest IPO of all time. The previous record holder was Visa back in 2008, and it raised only $17.9 billion.

Alibaba achieved a market cap of more than $228 billion, and that has made it the 4th most valuable tech company in the world. The only companies ahead of it are Apple ($611 billion), Google ($400 billion), and Microsoft ($384 billion). Alibaba is now more valuable than Facebook.

With such a dramatic entrance, many other tech companies are dreaming of a big IPO payoff as well. Perhaps you too are dreaming of this, or maybe you just want to be moderately successful first. But whether you are aiming high or have more reasonable expectations, you will undoubtedly need capital and lots of it. If an IPO is not practical for you, then you need other arrangements.

Bank Loans

This is perhaps the most obvious way of getting financing, but it has its share of drawbacks as well. The loan application process takes too much time, and even the chances of getting a loan is 50-50 at best. Banks require a lot of security, and for many tech companies the problem is that they may not have the assets to use as collateral.

And if you already have borrowed from a bank, you need to go through another long process if you want to get more money.

Venture Capitalism

Here, you raise capital by selling chunks of your company to venture capitalists. But this can be very expensive in the long run. For example, if your company is worth a million dollars, you have to sell 10% of it to get $100,000 in capital. But when your efforts to grow your business succeed and now your company is worth $3 million, that 10% is now worth $300,000. You essentially paid $200,000 to get $100,000 for your working capital.

And if you sell a large chunk of your company, you may end up losing control of it in the end.


With factoring for technology companies, the benefits are quite significant. The application process is much quicker. The chances of getting finance are also quite good, because your credit is irrelevant to the factor. The most important consideration is that your customers are credit-worthy.

If they are, then the factor advances you anywhere from 70% to 85% of value of the invoices almost immediately. You then get the rest of your money (minus the fee of the factor) when your customers finally pay in full. You can then use this money to pay overhead and payroll, or invest in research or better equipment.

With factoring for technology companies, you can make sure that your company is still yours. You don’t have to explain to a bank about your overall business strategy, and you don’t have to risk losing control of your business.

Invoice Factoring for Technology Staffing Companies | Tech Staffing Factoring

Companies that handle factoring for tech staffing companies have been funding payroll and growth for staffing companies for decades. What kinds of things can these companies do for your technology staffing company?


Companies such as Neebo Capital are proficient at getting maximum cash flow for your staffing company, eliminating bad debt, offering full payroll services, helping out young companies trying to grow, and some of these companies are great for brand new upstart companies because no minimum volume is required to get a foot in the door.


Does your company need cash flow sometimes, but not all the time? Sometimes, as-needed cash flow is essential. If the cash flow of your business suffers sometimes from seasonal ups and downs, customers not making as many orders, or orders coming in unexpectedly, you’ll discover that a cash-only program can really do the trick. When you require the cash, just send the timecards and invoices on customers who are credit-approved, and if you’ve chosen a fast-acting company, the cash can be transferred into your account the very next business day.


Your company may need maximum cash flow too. If your company is growing, you may want maximum liquidity to come from your assets. Try to sign up to get the maximum amount of cash flow. You will then just have to send in your weekly timecards and invoices, and you may get up to 90% of your cash, or even more, in your account the very next business day. Some of these companies can even help your business by cutting down on your expenses, eliminating bad debt, or cutting down on your overhead too. Focus your own staff on building the business, not on making pesky collection calls.


Some of these companies can also provide cash plus total services. If you’re trying to find a complete solution that offers administration and working capital, go for a full-service approach. Not all companies will provide a full range of services, but you should take advantage of them if they do.

A lot of these companies have national clients, and they manage hundreds of companies and clients all over the country, and they offer a full range of services too. Call and ask what they offer, and don’t be shy about finding out what they can get your company, outside of just quick cash for your invoices. Take advantage of the full suite of financial services that many of these companies offer.


Factoring is a normal and good part of a lot of different industries and businesses. It is when an outside company purchases accounts receivable. Factoring helps businesses out by giving them the power to make sure growth can happen without incurring debt or diluting their equity. Factoring for staffing companies is very common, and you should look into as a very viable way to get a cash infusion into your business without having to do some of the more unsettling things like getting debt or having to sell off a part of the company for some much-needed capital to help the business grow.

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