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  • I started an equipment sales business 3 years ago that has grown into $6mm revenue ($800k net). I’m experience serious cash flow issues and stress. Any advice?

    Charles created 2 days, 1 hour ago 0 Member · 1 Post
  • Charles

    Member
    October 12, 2019 at 7:47 pm

    I have projected our growth out fairly accurately over the past 3 years, and with current contracts and opportunities I believe we can easily hit $30mm+ annual revenue in 3 more years. This aggressive growth path is causing some serious cash issues, but banks are being more stingy on lending to help continue our growth due to our relatively short financial history. Most of our retained earnings goes into inventory growth and AR growth. I’ve considered seeking a financial partner, and I have determined our net present value to be $8mm (we also have relatively little debt). I’ve presented a term sheet to one investor offering 50% equity for $4mm. Am I being realistic in this valuation? Is an equity dilution a bad move? I’ve also considered private lenders but typically rates are too high, the term is too short, or the contracts are too risky. Any advice would be appreciated! Edit: I should mention that I am referring to annual revenue in the title – by hq overview throwaway61985 – –

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