Editing Supply@ME Capital
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===== What's a major problem that the target audience experience? ===== | ===== What's a major problem that the target audience experience? ===== | ||
The problem is a lack of profits, more specifically a lack of financing. | |||
The Federation of Small Businesses, a lobby group for the UK’s smallest companies, said a survey of members founds that successful applications for bank loans and other financing had dropped precipitously, with less than half of applications successful in the third quarter of 2022. The lobby group added that the smaller a business was, the less likely its request for a bank loan was to be approved. | |||
=====What's a key solution to the problem?===== | =====What's a key solution to the problem?===== | ||
The solution is Supply@ME, a web application that enables early-stage inventory-intensive businesses to raise funds. What makes the finance platform unique is that it raises the funds by selling [and then at a later stage (e.g. 90 days), buying-back, at a higher price (than the sold price)] the inventory of the businesses, using a type of financial agreement called the true sale inventory agreement.<ref name=":8" /> Evidence suggests that the true sale inventory agreement enables early-stage inventory-intensive companies to raise funds more efficiently, ultimately leading the companies to improve/maximise their profits<ref name=":3" />. | The solution is Supply@ME, a web application that enables early-stage inventory-intensive businesses to raise funds. What makes the finance platform unique is that it raises the funds by selling [and then at a later stage (e.g. 90 days), buying-back, at a higher price (than the sold price)] the inventory of the businesses, using a type of financial agreement called the true sale inventory agreement.<ref name=":8" /> Evidence suggests that the true sale inventory agreement enables early-stage inventory-intensive companies to raise funds more efficiently, ultimately leading the companies to improve/maximise their profits<ref name=":3" />. | ||
Note, with a true sale inventory agreement, | Note, with a true sale inventory agreement, the fundraising transaction is recorded off the balance sheet of the fundraising company (i.e. off-balance sheet transaction<ref>An off-balance sheet (OBS) transaction is a type of financial arrangement in which a company does not record certain assets or liabilities on its balance sheet. The main benefit of an OBS transaction is that it can help a company to manage its financial statements in a way that makes its financial position appear stronger than it would if the assets or liabilities were recorded on its balance sheet. | ||
One of the primary benefits of OBS transactions is that they can help a company to manage its level of debt and leverage, by allowing it to keep certain liabilities off its balance sheet. This can make the company's debt-to-equity ratio appear lower, which can be attractive to investors and creditors. | |||
Another benefit of OBS transactions is that they can help a company to manage its level of risk. By keeping certain assets or liabilities off its balance sheet, a company can limit its exposure to certain types of risk. For example, if a company enters into an OBS transaction to finance a project, it can limit its exposure to the project's risks by not recording the project's assets and liabilities on its balance sheet.</ref>, more specifically off-balance sheet inventory repurchase agreement transaction). The off-balance sheet transaction makes the financial position of the fundraising company appear better than it actually is, usually resulting in better investment (and creditor) terms. | |||
==== Secondary offering/audience ==== | ==== Secondary offering/audience ==== | ||