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How Short-Term Funding Helped a Commercial Construction Firm Take on Bigger Projects
With flexible short-term funding, this commercial construction firm was able to take on larger, more complex projects without tying up their cash flow. By securing the right financing, they scaled operations, met tight deadlines, and positioned themselves for long-term growth.
Funding Amount: $150,000.00
Industry: Construction and Remodeling
Use of Funds: Bridging gaps in payments
Vision
Cornerstone Construction, a mid-sized commercial construction firm based in southern California, had a clear vision for growth. With a decade of experience in small to medium-sized commercial projects, the company's leadership saw an opportunity to expand their capabilities and take on larger, more lucrative contracts. Their ambition was to transition from local strip mall renovations and office fit-outs to multi-story commercial buildings and expansive retail complexes.
Opportunity
The construction industry in Denver was booming, with numerous large-scale projects on the horizon. Cornerstone recognized that by increasing their project capacity, they could position themselves as a formidable competitor in this growing market. Larger projects not only meant higher revenue but also the potential for long-term contracts, increased visibility, and the ability to build a more robust portfolio. This growth would allow Cornerstone to attract top talent, invest in advanced equipment, and potentially expand their services to include design-build capabilities.
Challenge
Despite their vision and the abundant opportunities, Cornerstone faced a significant hurdle: cash flow management. The construction industry is notorious for its payment cycles, with many projects operating on a pay-when-paid basis. This meant that Cornerstone often had to wait 60 to 90 days after completing work to receive payment. As they contemplated taking on larger projects, this delay in payment posed a serious risk to their day-to-day operations and growth plans.
The challenges they faced included:
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Meeting payroll for an expanded workforce
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Purchasing or renting specialized equipment for larger projects
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Covering upfront costs for materials and subcontractors
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Maintaining a financial buffer for unexpected project delays or changes
Traditional bank loans were not a viable solution due to the lengthy approval process and rigid repayment terms that didn't align with the unpredictable nature of construction cash flow.
How Capitalize Helped
Recognizing the need for a flexible and timely financial solution, Cornerstone turned to Capitalize Funding. After a thorough assessment of Cornerstone's financial health, project pipeline, and growth potential, Capitalize Funding provided a $150,000 cash flow funding package tailored to the construction firm's needs.
Key features of the financing solution included:
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Quick approval and fund disbursement within 1 business day
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Flexible repayment terms aligned with project completion and payment schedules
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No collateral required, preserving Cornerstone's assets for other investments
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Scalable funding option, allowing for additional capital as new projects were secured
This infusion of capital provided Cornerstone with the financial stability and confidence to bid on larger projects, knowing they could manage cash flow effectively throughout the construction process.
Results
With the support of Capitalize Funding's cash flow funding, Cornerstone Construction achieved significant growth and success:
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Successfully bid on and won a $2.5 million contract for a five-story office building renovation
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Increased their workforce by 30%, hiring skilled project managers and tradespeople
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Invested in advanced project management software and state-of-the-art equipment
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Improved supplier relationships by consistently meeting payment terms, often securing better prices for materials
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Reduced stress on the company's finances, allowing leadership to focus on strategic growth rather than day-to-day cash flow concerns
Within 18 months of receiving the initial funding, Cornerstone had completed three large-scale projects, doubling their annual revenue and establishing themselves as a key player in Denver's commercial construction market.
Conclusion
The partnership between Cornerstone Construction and Capitalize Funding demonstrates the transformative power of well-structured cash flow funding in the construction industry. By addressing the critical challenge of managing cash flow in an industry known for payment delays, Capitalize Funding empowered Cornerstone to pursue their growth ambitions confidently.
This case study illustrates how access to flexible, timely funding can be the catalyst for significant business growth. For Cornerstone, the $150,000 in cash flow financing was not just a financial transaction; it was an investment in their future, enabling them to bridge the gap between ambition and achievement.
As Cornerstone continues to thrive in the competitive construction market, their success story serves as a testament to the importance of having a reliable financial partner who understands the unique challenges of the industry. Capitalize Funding's commitment to providing customized funding solutions has not only helped Cornerstone weather the cash flow challenges inherent in construction but has also positioned them for sustained growth and success.
For construction firms and other small businesses facing similar cash flow challenges, Capitalize Funding stands ready to provide the financial support and partnership needed to turn growth opportunities into reality. To learn more about how Capitalize Funding can help your business overcome financial hurdles and achieve its goals, visit our contact page or connect with us on Facebook and Instagram.
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