Working Capital for Technology Companies
You signed a $400,000 implementation contract yesterday. Delivery requires hiring 2 engineers immediately at $15,000 monthly combined, purchasing $30,000 in infrastructure, and your first invoice is not for 60 days. Working capital bridges the gap between project start and revenue arrival.
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Working Capital for IT Business
Technology working capital must account for project timing, talent acquisition costs, and the reality that expenses precede revenue by weeks or months in project-based businesses.
The Project Cash Gap
A $300,000 project might require $75,000 in upfront costs: contractor payments, hardware, dedicated staff time. Even with deposits, 60-90 days of expenses occur before substantial invoicing.
Talent Timing
Hiring a $120,000 engineer means paying salary from day one, but billable time takes 30-60 days to develop. Each new hire creates a predictable cash gap.
MRR as Collateral
Monthly recurring revenue provides predictable cash flow that traditional lenders undervalue. Recurring revenue supports financing better than transaction-based business.
Growth vs. Cash Flow
IT companies often choose between growth and positive cash flow. Working capital allows pursuing growth while maintaining operations.
IT Working Capital Challenges
Technology businesses face capital challenges driven by project timing and talent investment.
Project Timing Mismatch
New contracts require immediate investment. Staff, equipment, and resources must be deployed before invoices can be sent. Project timing creates cash gaps.
Talent Acquisition Costs
Engineers cost $100,000-$200,000 annually. You pay from day one, but productivity and billing take time to develop. Growth requires hiring ahead of revenue.
Enterprise Payment Terms
Fortune 500 clients demand net-45 or net-60. Your invoice sits in their system for 60+ days. Staff expects payment every two weeks.
Infrastructure Requirements
Client projects require hardware, software, and infrastructure investment before deployment and billing.
Scaling Constraints
You could take on more clients, but delivery capacity is constrained. Growth stalls waiting for cash to hire.
Bank MRR Blindness
Banks do not understand recurring revenue valuation. Your $80,000 MRR gets evaluated like a retail store.
Working Capital Application Process
From application to funding in days, not weeks.
Application
Complete online application with business information and capital needs.
10 minutes
Documentation
Provide bank statements. MRR documentation and contracts helpful but not always required.
Gather documents
Evaluation
We review financials understanding IT revenue models and project economics.
24-72 hours
Funding
Accept terms and receive funds deposited to your business account.
Same or next day
Cash Flow Support for Technology Business
Working capital structured for IT provides the bridge between project investment and revenue arrival. Fund talent, equipment, and growth when you need to, repay from project revenue and recurring contracts.
MRR Understanding
We value recurring revenue appropriately. Monthly recurring revenue demonstrates repayment capacity beyond what traditional metrics show.
Project Bridge
Fund hiring, equipment, and deployment costs before project revenue arrives. Bridge predictable project timing gaps.
Flexible Use
Payroll, contractors, equipment, infrastructure, or any legitimate business expense.
Fast Decisions
Contract opportunities have deadlines. Get capital decisions in hours to days, not weeks.
Payment Options
Daily, weekly, or monthly payment structures to match your cash flow patterns.
Growth Capital
Scale delivery capacity ahead of revenue. Growth capital when you need it.
Working Capital Applications
Common scenarios where IT working capital makes the difference.
Project Staffing
New contract requires immediate hiring. Fund 60-90 days of salary before project revenue arrives.
Typical funding: $50K-$200K
Infrastructure Investment
Client project requires hardware and infrastructure deployment before billing.
Typical funding: $25K-$100K
AR Bridge
Enterprise clients pay net-60. Bridge to payment while maintaining operations and payroll.
Typical funding: $40K-$200K
Sales Investment
Scale sales team to drive growth. Fund headcount before revenue catches up.
Typical funding: $50K-$150K
Contractor Payments
Subcontractors require timely payment. Working capital covers contractor costs before client pays.
Typical funding: $25K-$100K
Capacity Expansion
Scale delivery capacity to take on more clients. Invest ahead of demand.
Typical funding: $75K-$250K
Working Capital Options for IT Companies
Understanding available options for technology working capital.
| Feature | Working Capital Loan | Bank Line of Credit | AR Financing |
|---|---|---|---|
| Speed | 24-72 hours | 30-60 days | 24-48 hours |
| MRR Understanding | High | Low | Moderate |
| Payment Structure | Fixed schedule | Interest on draws | When clients pay |
| Collateral | Often none | Usually required | AR |
| Qualification Focus | Revenue/deposits | Credit/assets | Invoice quality |
| Best For | Project bridge | Ongoing access | Enterprise AR |
| Total Cost | Moderate | Lower | Per invoice |
| Max Amount | $25K-$500K | Varies | Based on AR |
Working Capital Requirements
General requirements for IT working capital loans.
Operating History
Established IT business with revenue history.
1+ year preferred
Revenue
Demonstrated revenue from services, projects, or recurring contracts.
$200,000+ annual
Bank Activity
Business bank account showing regular deposits reflecting operations.
4+ months statements
Client Relationships
Active clients with current contracts or recurring revenue.
Documented clients
Cash Flow Pattern
Deposit patterns demonstrating ability to handle repayment.
Consistent deposits
Current Obligations
Current on existing business obligations without active defaults.
No current defaults
Strong MRR and enterprise contracts can support higher financing amounts. We evaluate each situation individually.
Real Results
TechForce Solutions
IT Services Company, Seattle WA
The Challenge
TechForce signed a $600,000 annual contract with a Fortune 500 company requiring immediate onboarding of 3 engineers at $200,000 combined annual salary. First invoice in 45 days, payment in 90+ days. They needed $120,000 to execute.
The Solution
We structured $125,000 working capital in 4 days, valuing their existing $55,000 MRR and the new contract backlog. Monthly payments of $6,800 fit their cash flow.
The Result
Engineers hired within 2 weeks. Project launched on time. Client satisfaction led to scope expansion adding $200,000 annually. TechForce has since used working capital for two more major contract wins.
“Banks wanted to see revenue from the contract before lending. But I needed capital to deliver the contract. Understanding our MRR and project timing made all the difference.”
IT Working Capital Data
Industry benchmarks for technology working capital needs.
Working Capital Advantages for IT
Why technology companies choose working capital loans.
Project Execution
Fund project delivery before revenue arrives. Execute contracts without cash constraints.
Talent Investment
Hire engineers and developers when you need them, not when cash allows.
Growth Enablement
Scale capacity ahead of demand. Growth capital when you need it.
AR Bridge
Maintain operations while waiting for enterprise payment cycles.
No Equity Dilution
Debt financing does not require giving up ownership. Grow without diluting equity.
Speed to Capital
Contract opportunities have deadlines. Get capital fast enough to act.