Asset-Based Lending
Unlock Capital from Your Existing Business Assets
Borrow against your receivables, inventory, equipment, and real estate — from $50K to $10M with flexible structures.
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Rates, terms, fees, and funding timelines vary by lender, applicant eligibility, and program requirements.
Asset-based lending (ABL) allows businesses to borrow against the value of their existing assets. Unlike traditional loans that focus primarily on creditworthiness and cash flow, ABL focuses on the quality and value of your collateral. This makes it accessible to businesses that may not qualify for traditional bank financing but have significant assets on their balance sheet.
Eligible assets typically include accounts receivable (the most common ABL collateral), inventory, equipment and machinery, real estate, and in some cases intellectual property. The lender places a lien on the assets and advances a percentage of their value — typically 80–85% of eligible receivables, 50–70% of inventory, and 60–80% of equipment. As your assets grow, your borrowing capacity grows with them.
This makes ABL particularly useful for businesses in transition, turnaround situations, or those with cyclical cash flows that may not qualify for traditional financing. It's also a powerful tool for financing growth, acquisitions, and management buyouts. Many businesses use ABL as a stepping stone — building a track record of borrowing and repayment that eventually qualifies them for conventional bank financing at lower rates.
ABL facilities can be structured as revolving lines (where you draw and repay against the asset base) or term loans (where you receive a lump sum secured by specific assets). Some facilities combine both — a revolving line against receivables and inventory, plus a term loan against equipment. This flexibility allows the financing to be tailored to your specific asset mix and cash flow needs.
A Simple, Fast Process
Asset Audit & Valuation
The lender audits your eligible assets — receivables, inventory, equipment — to determine their value and quality. This determines your borrowing base.
Establish Your Borrowing Base
Your borrowing base is calculated as a percentage of eligible asset values. This is the maximum amount you can borrow at any given time.
Draw Against Your Assets
Draw funds as needed up to your borrowing base. As you collect receivables or sell inventory, you repay and can draw again.
Periodic Redetermination
Your borrowing base is periodically re-evaluated (monthly or quarterly) as your asset values change. As your business grows, your borrowing capacity grows.
How Businesses Use This Financing
Turnaround Financing
Access capital during a business turnaround when traditional lenders won't touch you but you have valuable assets.
Growth & Expansion
Fund rapid growth by borrowing against the receivables and inventory your expansion is generating.
Acquisition Financing
Finance a business acquisition using the target company's assets as collateral for the loan.
Management Buyout
Fund a management buyout by leveraging the company's existing asset base.
Seasonal Inventory Build
Borrow against existing receivables to fund seasonal inventory purchases, then repay as inventory sells.
- Higher advance rates than unsecured loans — up to 85% of receivables
- Based on asset value, not just credit — accessible to more businesses
- Flexible structures — revolving, term, or hybrid facilities
- Borrowing base grows as your assets grow — capital scales with your business
- Can include multiple asset types — AR, inventory, equipment, real estate
- Often cheaper than factoring for businesses with strong receivables
- Builds a track record for graduation to conventional bank financing
- Can be combined with other financing for layered capital structures
- ◆Identifiable and liquid assets (AR, inventory, equipment, real estate)
- ◆Asset appraisal or audit required
- ◆Business financials and tax returns
- ◆Minimum $50K in eligible assets
- ◆Business verification and due diligence
- ◆Clean receivables — no liens or encumbrances
- ◆Financial reporting capability for ongoing monitoring
The Distributor That Outgrew Its Bank
How asset-based lending funded a $3M expansion when the bank said no
A wholesale distributor had grown 40% year-over-year for three consecutive years. The company had $1.2M in accounts receivable, $800K in inventory, and $500K in equipment. But when the owner approached his bank for a $2M line of credit to fund a new warehouse, the bank declined — citing that the company's debt-to-equity ratio had risen due to the rapid growth, even though the business was profitable.
He came to Let's Syndicate and was matched with an asset-based lender who evaluated the company's assets rather than its ratios. The lender established a borrowing base of $1.8M — 85% of eligible receivables ($1.02M), 50% of inventory ($400K), and 75% of equipment ($375K). The facility was structured as a revolving line, allowing the company to draw and repay as receivables turned and inventory sold.
The company drew $1.5M to fund the new warehouse and inventory build. As the new location generated additional receivables, the borrowing base grew, giving the company access to more capital without reapplying. Within 18 months, the company's improved financial profile and track record qualified them for a conventional bank line of credit at a lower rate — a graduation that the ABL relationship had made possible.
Result: $1.8M borrowing base established. $1.5M drawn for warehouse expansion. Graduated to conventional bank financing within 18 months.
Your Assets Have More Value Than Your Bank Thinks
Traditional banks evaluate loan applications using ratios — debt-to-equity, current ratio, debt service coverage — that can penalize fast-growing companies. A business that is growing rapidly and profitably may have rising debt-to-equity simply because it's investing in its future. Banks see risk; asset-based lenders see collateral.
Let's Syndicate connects you with asset-based lenders who evaluate your business on the quality and value of your assets, not generic financial ratios. Your single application reaches lenders who understand that growth requires capital, and that your receivables, inventory, and equipment are real, liquid assets that can secure the financing you need.
- Lenders who evaluate asset value, not just financial ratios
- Higher advance rates than traditional bank loans
- Borrowing base grows automatically as your assets grow
- Flexible structures — revolving, term, or hybrid
- A graduation path to conventional bank financing as your profile strengthens
Common Questions About Asset-Based Lending
The most common ABL collateral is accounts receivable (80–85% advance rate). Inventory (50–70%), equipment (60–80%), and real estate (50–65%) are also eligible. Some lenders accept intellectual property. The specific mix depends on your business and the lender's specialty.
With factoring, you sell your invoices to a factor at a discount. With ABL, you borrow against your receivables (and other assets) while retaining ownership. ABL is typically cheaper than factoring for businesses with strong receivables, and it doesn't involve your customers in the financing arrangement.
A borrowing base is the maximum amount you can borrow at any given time, calculated as a percentage of your eligible asset values. It's periodically redetermined (monthly or quarterly) as your asset values change. As your business grows and your assets increase, your borrowing capacity grows with it.
Setting up an ABL facility typically takes 3–6 weeks, including asset audit, due diligence, and legal documentation. Once established, draws against the facility are available within 1–2 business days. The initial setup is longer than some alternatives, but the ongoing access is fast.
Yes. Because ABL is secured by your assets, lenders are more focused on asset quality and value than personal credit. While credit is still a factor, businesses with lower credit scores but strong assets can often qualify. Let's Syndicate matches you with ABL lenders whose credit requirements fit your profile.
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Let's Syndicate is a business funding marketplace. All credit decisions, rates, terms and outcomes are determined by participating lenders, investors or third-party providers.