- Factoring Basics
- Factoring Process
- Factoring Requirements
- Getting Started
- Harper Partners
- Industries Served
We work with companies based anywhere in the United States or Canada. We’re happy to say that we have clients all across North America.
Factoring costs can range from 1-6% per month depending on the industry, your business sales volume and the creditworthiness of your customers.
Harper’s fees range from 1-3% per month with advance rates ranging from 70-90% of the gross invoice amount. As you develop a successful track record with us over time, your fees will be lowered and your advance rate increased.
For example, on a $100 invoice, the fee per month could be as low as $1. Assuming the invoice is outstanding for 60 days, the total fee for the cash advanced is $2.
Be careful about factoring fees calculated on a month-by0month basis, which certain factoring companies charge. For instance, an invoice outstanding for 31 days would be charged for 60 days (2 months) because it’s 1 day over 30 days. Harper Partners fees are calculated on a daily basis, so however long the invoice is outstanding (to the exact day) will determine the fee.
Depending on the size of the facility we will sometimes require personal guarantees. We typically require at least a validity guarantee, which makes certain promises regarding the state of your receivables including:
- Valid for products delivered or work completed
- Not already pledged to another creditor
- Is collectible
However, we have funding partners that do not require personal or validity guarantees. Let us know if you would like to learn more, we’re happy to provide more details.
The entire underwriting and funding process typically takes 2-5 business days as long as all the necessary documents are provided. The initial funding generally takes 24 hours after signing the funding agreement. Advances on invoices from familiar customers can take as little as a few hours, with funds reaching your account the same or next day via wire.
If you intend to factor over $5,000 per month of invoices, we can work with you. We have the ability to provide factoring credit lines up to $5 million.
Harper works with both venture capital funded startups and those seeking to raise venture capital.
For VC-backed companies, we provide affordable financing to bridge cash flow gaps while the venture capital is used for high ROI projects (technology, sales, operations infrastructure, etc). Harper’s funding also extends the cash runway of VC-backed startups so that they can raise at a higher valuation in their next round.
For companies interested in raising venture capital, we help maintain their growth trajectory by bridging gaps in working capital. With longer cash runway, startups are able to fundraise more successfully.
No. Many of our clients are very early stage and are not yet profitable, or no longer qualify for traditional bank financing due to financial or operating circumstances.
As of now, Harper is focused on U.S. or Canadian companies.
Our backgrounds include private equity, business consulting, investment banking, commercial finance and entrepreneurship. We come from families of small businesses owners and are passionate about helping entrepreneurs find the right financing solutions.
Harper currently accepts invoices where:
- The service or product was completed, delivered and accepted by your customer
- The customer is based in the U.S.
- The customer is a business (not a consumer)
- The invoice face value is higher than $5,000
- The due date is at least 3 weeks away
- The invoice is not overdue
Simply that our clients provide services or goods to creditworthy customers, and we can verify that the invoices being submitted for purchase are valid. Our approval decisions are based on the creditworthiness of the client’s customers and not on the financial strength of our client. As such, our funding solutions are a perfect fit for startups and small businesses selling to other businesses.
A client is the company that signs the agreement with the factor and provides the goods or services. A customer is the company that buys goods or services from the client.
Factors purchase accounts receivable from the client. The accounts receivable represent the amount owed by the customer to the client for goods and services provided.
Traditionally, factoring has been found in the textiles, trucking, wholesale and staffing industries, to name a few. In all these industries, companies were required to pay vendors before they received customer payment. With the growth of the online B2B economy, many digital media, advertising and technology businesses now face these same issues.
Companies of all sizes, from sole proprietors to Fortune 500s, use factoring as a way to improve their cash flow. Factoring can benefit companies in all stages of their growth, from startups to mature businesses.
Harper Partners (“Harper”) is a leading provider of working capital financing to companies across many different industries. We enable businesses to get paid immediately for outstanding invoices by advancing funds for the amount due. Through our partners we can also fund against your future revenue if you are a B2C business or don’t otherwise have AR. We have the capability to extend funding up to $5 million. Partnering with us comes with many benefits beyond just capital.
Factoring is the sale of accounts receivable at a discount. It’s often used interchangeably with several other terms including invoice factoring, receivables factoring, invoice financing, or receivables financing. All the terms effectively mean the same thing – the sale of a company’s receivables to provide short term working capital funding.
To qualify for factoring, a company’s customers typically need to be another business or the government. It’s used in many industries including transportation, staffing, distribution, consumer and enterprise products, and business services, to name just a few. Companies in all stages of growth, from startup to Fortune 500, use factoring to improve cash flow.
For a detailed explanation of factoring check out our Invoice Factoring 101 guide.
No, not at all! Factoring or AR financing, can be traced as far back as the Code of Hammurabi in 1,754 B.C. It’s the purchasing of commercial paper, invoices, receivables, trade acceptances and contract rights.