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When Ron Cedillo, VP of housing provider Lima Charlie, had to find new sources of business, he learned that the government contracting space could be a valuable growth channel for his company–but large dollar amounts and mismatches between cash inflows and outflows quickly proved challenging for the execution.
“When you do government contracting, it’s kind of interesting because you win a government contract and you’re providing all the services up front and then you have to go back in, bill the government, and that can take anywhere from 30 or 45 to 60, even 90 days lag time and your cash flow is really tied up,” said Ron. “And if you start doing multiple projects, the dollars become really, really big. We had to find different sources of funding just to keep our vendors who we hired out to do the work. And more importantly, fulfill the contract. We know we were going to get paid later on, but it took sometimes 60, 90, 120 days later.”
Even with established banking relationships, Ron couldn’t get traditional financing.
“Before I got to FundThrough, I was actually turned down by 50 different banks. I was banging my head every day just knowing I was going to get rejected until someone actually said, ‘you’re going down the wrong path. Here’s the actual path you really want to go through’. And then once I got the clarity of working with the factoring company, things moved really fast.”
Getting invoices paid early gave Ron the quick cash flow he needed to successfully complete his first government contract.
“I was talking to four different companies, and one of the things that I found was different across the companies was speed. I needed speed,” said Ron. “That was one of my key, key components. I had to raise a lot of money within 30 days, and I was looking for someone that can guarantee that we can get paid as soon as possible. FundThrough kind of checked the boxes on that. I found with FundThrough the communication was fast; the communication was easy. But speed was most important for us. That allowed us to do what we needed to do very quickly.”
Introducing FundThrough to Ron’s customer was seamless.
“When our customer had questions, FundThrough was able to answer those questions. It worked out really well because we were able to give them assurances that we were able to work and fulfill the contract because that’s always the number one thing,” said Ron.
Now, he’s growing Lima Charlie through a new growth channel at his own pace with unlimited funding available anytime.
“FundThrough allowed us to grow exponentially because we had the backing, knowing that the money was going to be there. We were able to take on some larger projects that if we had to self-fund, we would never have been able to achieve. Now, when we see large contracts available in the government space, we’re running toward them instead of shying away. This has allowed us to take large leaps and very, very quickly because we know that we have the invoice funding process and a partner that wants to see us grow,” said Ron. “The one thing that we talked about a lot in our company was that FundThrough made us a better company. You helped refine a few of our processes on the billing side. It got so much better because you guys actually helped us understand how to do this in a better way.”