Behind the Masks

Looking for a fright? Remember the words of JFK: “The only thing to fear is fear itself.”

If borrowing feels scary, consider this: missed opportunity is scarier.

The illusion of bootstrapping is more trick than treat if you ask me.

Of the two paths to growth, one has the appearance of thrift but masks a costly reality: missed opportunity and unclosed deals. The other is costly on the surface but seizes opportunity behind the scenes. It makes time-bound deals and snags time-sensitive customers. Yes, it comes at a premium. But there’s a term for a cost with an ROI: an investment. 

Flexibility, The Ultimate Luxury

Of all the luxuries afforded by the rich, flexibility is one of the most overlooked.

Not by Oracle founder Larry Ellison.

Despite his multi-billion-dollar net worth, he uses leverage to fund his expensive (and generous) lifestyle.

Why? He believes in himself.

Ellison is so confident in the continued growth of his businesses that he sees cashing out as a cost, not savings.

It’s yet another example of how “the rich get richer,” but one we can all learn from. When growth is likely, leverage could be logical.

The Express Lane

There’s no way this is worth it. Right?

Wrong. Everything has a striking point. What’s the value of 20 minutes when the only thing greeting you at home is a microwave dinner and the evening news? Not much.

But when those same 20 minutes mean pulling into the hospital in time to cut the umbilical cord or arriving at HQ in time for big interview Suddenly, the price tag is justifiable.

The same is true in lending. Not all moments in the lifecycle of a business are equal.

When a dream customer calls with a time-bound order, a factory expansion might be warranted.
When an influencer features your product in their holiday gift guide, hiring up might be the only way not to blow your big moment.

And when continuing as a going concern is a concern, a few extra basis points are nothing to fear.

In my world, asset-based lending is priced at a premium. But it’s priced for performance. Sometimes, traditional lending won’t meet the deadline. Won’t seal the deal. Won’t meet the moment. When ABL does, it’s worth every penny.

Interest Rates Take a New Trajectory

Size doesn’t matter.

Trajectory does.

Last month’s fed cut has less to do about its amount than its direction – down.

Look at the charts. Interest rates rarely fluctuate. Instead, they tend to rise or decline repeatedly before pausing and reversing.

September’s rate cut marks a pivot. The Fed is in slash mode. The odds of rising rates anytime soon? Unlikely.

That’s a big deal for business owners considering adjustable-rate capital like asset-based lending. Chairman Powell’s move has a hidden message: cheaper capital is likely coming.

The world’s stubborn “wait-and-see” mode? It’s over.

Projects, investment, and growth? Game on.

The American Entrepreneur’s Advantage

The biggest advantage American entrepreneurs have? Most don’t even realize it.

As a Romanian-American, what strikes me most about U.S. entrepreneurs is not just their ideas, but their access to capital.

Elsewhere, scarcity of capital is one of the greatest challenges. In America, access is abundant, yet many still hesitate to use it.

“Cash is king,” some say. Others avoid debt at all costs. But rapid growth is fueled by capital. America’s reputation for risk-taking comes from both internal drive and external conditions.

Don’t take it for granted. Just ask some of the most successful entrepreneurs the country has ever seen.

How do you see capital: as fuel for growth or a risk to avoid?

Pumpkin Spice Lending? ABL & Seasonality

Pumpkin spice: valuable or not?

Judging by its faithful reentry into American culture every fall, its worth (to many) is high.

But let’s say you’re the company that manufactures the flavor year-round. You stockpile the shelf-stable syrup before delivering it to clamoring hordes in the fall.

Now, what if you require a line of credit in March? To many lenders, your business’s seasonality is a problem. Your treasured nutmeg-scented inventory could be deemed worthless.

Not so at Sawgrass Finance. Our asset-based lending model takes inventory into account and considers factors others don’t – like seasonality.

Pumpkin-spice hurdle? PSL frenzy can continue without interruption, thanks to the power of ABL.

Embracing a Bullseye in Specialty Lending

For years, I resisted the notion that I was a specialist.

“For any commercial lending need, call Marius.” After all, my Rolodex could surely meet the needs of any owner I couldn’t serve directly.

But I’ve learned that attempting to be “all things to all people” is the bigger risk. As Al Ries and Jack Trout explain in their book "Positioning," a brand that stands for something specific in the mind is more powerful than one that stands for everything.

Here’s the reality I’ve come to embrace: I specialize in helping business owners whose borrowing needs fail to check the boxes of rigid lending programs. Perhaps they have a trove of valuable inventory, but operate a seasonal business. Perhaps they’d make a great candidate for equity investment, but time is of the essence. I help them get credit for accounts receivable and inventory, literally and figuratively.

Do I hope bankers and business owners will think of me as more than that? Certainly. But when you paint a bullseye, some arrows strike the outer rings, too.

The Overlooked Advantage of EBITDA

Six letters haunt the sleepless nights of any business owner seeking acquisition: EBITDA.

The acronym is thrown around so widely, you’d think its repercussions would be universally internalized. You’d think – and you’d be wrong.

Case-in-point, a pop quiz: what’s the impact on the sale price of a manufacturing company borrowing at 5% versus 15%?

For a sale price garnered from a multiple of EBITDA, none. Mind blown? You’re in good company.

I get it: today’s interest rates are high. But EBITDA spells it out in plain letters: high interest rates are no hindrance if leverage produces profit.