Rosenthal & Rosenthal completed a $500,000 purchase order finance facility for a developer of virtual reality video games.
The financing will be used to support the production of games required to fulfill the fall/holiday 2018 orders from several major retailers. After gaining initial traction launching products in late 2017 and early 2018, the company experienced a significant increase in orders that resulted in cash flow strain related to purchasing the required inventory.
The supply chain financing requirements of this transaction required Rosenthal to issue letters of credit to a main international supplier that purchased specialized packaging from an additional supplier before shipping the completed product from Asia. The inventory was ultimately financed at an advance rate of 100% of the cost of the goods, inclusive of all logistics expenses.
“We were pleased to assist this rapidly growing company take advantage of a major market-breaking opportunity,” said Rosenthal Division Head Paul Schuldiner. “The Rosenthal P/O finance team has a proven track record of working with toy industry entrepreneurs who have the ability to scale a business quickly and profitably, but do not wish to dilute their ownership at an early stage in the company life cycle by raising equity. This transaction highlights why Rosenthal looks past the size of the immediate need and takes a long-term look at the growth potential of a business.”
