Asset Based Lending for Small Businesses: 11 Strategies for Growth

Picture this: You’re a business owner—maybe in construction, manufacturing, or even a medical clinic—standing at the edge of a massive growth opportunity.

You’ve got new contracts lined up, expansions planned, or equipment to purchase.

But your bank?

They’re dragging their feet or demanding near-perfect credit.

I’m Mark Kane, CEO of Sunwise Capital, and I’ve walked this road from every angle—psychologist dealing with fear and ambition, Wall Street broker juggling massive capital deals, investment banker bridging market gaps, and a 25-year business owner who’s fought to secure funding in real-world scenarios.

So, here’s the good news: asset based lending for small businesses has never been more accessible.

If you’re hungry for growth—despite credit score hiccups or seasonal cash flow swings—asset-based solutions can be your fast, flexible ticket to a new level of success.

Keep reading, because I’ll show you exactly how to tap these financing tools, whether you’re in HVAC, roofing, retail, medical or any business with real assets.

Why Asset Based Lending for Small Businesses Matters More Than Ever

Since 2010, we at Sunwise Capital have seen countless entrepreneurs—from modest $300K annual revenue up to $25M—struggle with banks that can’t understand their industry nuances or short-term credit dips.

Over 80% of our clients come from construction and contractor segments like HVAC, roofing, plumbing, and landscaping.

But we also serve manufacturing, wholesale, retail, and medical.

Time and again, these folks hit a common roadblock: traditional lenders want rock-solid, year-round cash flow and near-stellar credit (650+).

But real business is messy.

Maybe you ramp up in summer, or you rely on large project payouts that arrive quarterly.

That’s where asset based lending for small businesses comes into play.

It’s a financing structure that uses your tangible (and sometimes intangible) assets—inventory, receivables, equipment—as collateral.

Because your lender has these assets in their back pocket, they can relax on your personal credit score or strict monthly statement patterns.

Suddenly, you can get funded in days rather than months, skipping the “Sorry, you don’t meet our score threshold” fiasco.

And here’s the kicker:

We’re entering a phase where infrastructure projects (roads, bridges, power grids) and technological expansions (like telemedicine or advanced manufacturing lines) are demanding more working capital than ever.

Banks remain cautious—heightened interest rates, regulatory constraints—leaving a funding gap for forward-thinking entrepreneurs.

Asset-based lending swoops in, bridging that gap and propelling growth-hungry owners to their next milestone.

Unspoken Fears, Frustrations, and Goals of Business Owners

From my psychology days, I know it’s not just about the numbers.

Let’s address the emotional undercurrent: fears, frustrations, and ultimate goals that push owners toward asset based lending for small businesses.

Fear: “I’ll Lose Big Contracts or Fall Behind Competitors”

Picture an HVAC firm with a $1M contract looming, but no immediate capital to purchase advanced systems.

Time is ticking.

Or a roofing company seeing an infrastructure-driven project wave but lacking the funds to expand staff and equipment.

The fear is real: “If I don’t secure this money fast, a competitor will swoop in, or I’ll miss the construction window.”

No business owner wants to watch golden opportunities fade because a bank says “wait a few weeks.”

Frustration: “Banks Don’t Get My Revenue Cycle”

A landscaper might see 70% of its revenue from April to August, making monthly statements look inconsistent.

A wholesaler might have huge spikes around holiday season.

Banks interpret these seasonal or project-based surges as “unstable cash flow.”

You, on the other hand, know it’s just the nature of your industry.

The friction leads to endless document requests, or a blunt rejection letter.

No wonder business owners get furious.

Goal: “Secure Funding Without Draining My Personal Credit or Assets”

Many folks want quick capital without gambling their personal home or perfect FICO score.

They aim to maintain that day-to-day freedom—like being able to pay staff, upgrade to cutting-edge machinery, or respond to new market demands—without giving up equity or piling on insane interest rates.

In short, they crave a fast-lane approach that genuinely respects their business’s real worth.

They’re tired of rigid loan officers focusing solely on a single monthly deposit pattern.

What Exactly Is Asset Based Lending for Small Businesses?

In straightforward terms, asset-based lending means you borrow money with your business assets as collateral.

These assets might be:

• Accounts Receivable: Outstanding invoices from reliable clients.
  Lenders can advance cash against those invoices, bridging that gap until payment arrives.
• Inventory: Stock you hold, especially if it’s valuable or in high demand.
  Great for retailers, distributors, or certain wholesalers.
• Equipment: Think heavy machinery, specialized medical devices, or delivery trucks.
  Common in the construction or transportation sectors.
• Real Estate: Commercial property can act as prime collateral if you have ownership or partial equity.
  But many want something more dynamic than a traditional mortgage path.

Because lenders have these assets to fall back on, they can relax typical demands around credit scores or unwavering monthly statements.

You get more flexible terms, potentially larger capital infusions, and a faster approval timeline.

Yes, if you default, the lender can seize the pledged assets.

But if you’re confident in your operations or your upcoming contracts—like an infrastructure deal or a new hospital wing—this might be the perfect synergy.

Infrastructure Spending and the ABL Edge

Now, consider the bigger picture: infrastructure investment is skyrocketing.

Projects from The Bipartisan Infrastructure Law are trickling into real economy projects—highways, power grids, water systems, transit expansions.

Someone has to build those roads, supply those cables, or upgrade bus fleets.

With so much on the table, you might be eyeing bigger expansions—like an earthmover for your construction firm or expanded capacity at your manufacturing plant.

But banks remain risk-averse in a post-pandemic, higher-rate climate, ignoring the boom.

That’s where asset based lending for small businesses steps into the limelight, fueling your capital needs quickly enough to catch these projects in real time.

And guess what?

Big players in private credit see the same trend.

Neuberger Berman’s $1.6 billion specialty-finance fund is one example, demonstrating how funds are pouring into these ABL structures.

The money is out there, searching for stable business owners who have real assets to pledge—and an immediate need to expand in the face of new market demand.

A Side-by-Side Look: Traditional Bank Loans vs. Asset-Based Lending vs. Sunwise Capital

Here’s the crux: asset based lending for small businesses can outperform traditional bank paths if you need a fast, collateral-based infusion.

But not all ABL providers are created equal—some still slog through older underwriting processes or demand heavier collateral.

At Sunwise Capital, we mix a hybrid approach: we look at your assets while also considering your revenue and future pipeline.

That combo speeds approvals and loosens rigid red tape.

Sunwise Capital’s Five Practical Steps to Secure Asset Based Lending for Small Businesses

Let’s get tactical.
How do you actually lock in this type of funding, and what do you need in place first?

1. Take Inventory of Your Assets:
   Are your receivables tied to reliable, paying clients?
   Do you have machinery with solid resale value?
   Make a list of potential collateral—like that forklift, specialized medical device, or big batch of inventory—and estimate real market worth.
2. Organize Your Financials:
   Lenders still want a glimpse of your balance sheets, income statements, and (if relevant) inventory logs.
   Having these up to date speeds the process.
   Tools like QuickBooks or FreshBooks simplify data exports.
3. Identify Growth Drivers:
   Whether it’s a new commercial roofing contract or advanced diagnostic equipment for a clinic, show how the borrowed funds will yield real returns.
   This is especially important if you also want a partial revenue-based component.
4. Research & Compare Lenders:
   Some asset-based lenders focus on big accounts only (> \$2M monthly revenue).
   Others cater to smaller or more niche industries.
   Make sure you align with a lender—like Sunwise Capital—that thrives on fast decisions and a wide industry scope.
5. Negotiate Repayment Flexibility:
   If your business is seasonal, request an arrangement that lightens payments during off-peak months or ties monthly installments to your receivables cycle.
   This is the secret sauce that truly sets asset based lending for small businesses apart from bank loans.

Capitalizing on Infrastructure: Equipment Demand & Asset-Based Loans

We’re living in an era where roads are being rebuilt, bridges overhauled, and green energy expansions are hitting full throttle.

If you’re in construction, HVAC, or a specialized wholesale sector selling to contractors, you can’t afford to wait around.

Equipment demand—like excavators, loaders, or advanced grid technology—keeps soaring.

Prices climb, and new orders sometimes take months to deliver.

Missing that early buy could cost you the entire season’s profit margin.

With asset-based lending, you can secure the funds to buy or lease heavy machinery, expand your warehouses, or cover a sudden surge in labor overhead.

Instead of the bank’s standard 4–6 week approval, you get answers in days or a week, enabling you to snag deals or outbid rivals on bigger government or private contracts.

We see Sunwise Capital clients who once scrambled to find bridging capital now seamlessly financing multi-million-dollar expansions—because they leveraged their existing assets (like prior equipment or big receivables from a city contract) to open the door to immediate growth.

Real-World Example: A Plumbing Company Leveraging Asset-Based Solutions

Let’s bring this home with a story:

“Mike” runs a medium-sized plumbing operation in Texas, bringing in about $800K a year.

He’s eyeing a new municipal contract thanks to infrastructure upgrades in his county—worth $400K if he can handle larger-scale projects.

But Mike’s bank sees the cyclical nature of his business (high in summer for construction season, moderate in winter) and his 620 credit score, thus turning down his $150K loan application for expansions.

Mike felt deflated—until he discovered asset based lending for small businesses.

At Sunwise Capital, we checked his existing equipment (trucks, specialized plumbing machines) valued at $90K, plus $50K in outstanding invoices from a reliable commercial builder.

We structured a quick $150K line, anchored by that combined collateral.

Approval took 4 days, funds arrived in under a week.

Mike bought more trucks, hired extra licensed plumbers, and snagged that municipal project.

Now he’s on pace for a $1.2M annual run rate.

No personal home risk, no 2-month bank delay—just a fast track to bigger profits.

Three Quick Tips to Maximize Asset Based Lending for Small Businesses

• Monitor Asset Valuations: Regularly update equipment appraisals or inventory audits.
  Lenders often re-assess collateral as markets shift.
• Track Invoicing Carefully: If factoring or receivables-based funding is your path, keep client payment histories squeaky clean and well-documented.
• Plan for Expansion, Not Just Survival: Show how the funds accelerate growth—like new lines of service or a bigger staff.
  This sweetens your pitch, even in asset-based scenarios.

FAQs: Asset Based Lending for Small Businesses

Q1: Is asset-based lending only for companies with high-value equipment?

A: Not necessarily. Receivables factoring counts, too. Some lenders even accept intangible assets if they’re tied to stable contracts. But yes, equipment-heavy sectors (e.g., construction, HVAC) often find it simpler since that machinery is straightforward collateral.

Q2: Won’t lenders charge me insane rates if my credit score is low?

A: Not always. The presence of collateral (your equipment or receivables) reduces the lender’s risk, often leading to competitive rates—even if your personal FICO lags. Sunwise Capital, for example, balances collateral coverage with your revenue potential, so you’re not penalized to the level of a high-cost merchant cash advance.

Q3: How does asset-based lending compare to revenue-based loans?

A: Both are alternatives to rigid bank loans, but they differ in how you secure funds. Asset-based lending leans on tangible or intangible assets as collateral. Revenue-based loans hinge on monthly or seasonal income streams for repayment. Sunwise Capital can blend both approaches if your business model benefits from that flexibility.

Q4: How fast can I close an asset-based deal?

A: That depends on how organized your financials are. If you have recent appraisals, clean inventory logs, and stable receivables records, finalizing can take under a week. We pride ourselves on speedy underwriting because we know time kills deals.

Q5: Is this approach risky if I can’t repay?

A: Default always carries risk. With asset-based lending, if you fail to repay, the lender can seize the pledged assets. But if you’re confident in your project pipeline—especially with infrastructure expansions or stable demand—this risk is offset by fast capital that can significantly boost your revenue. Just ensure you’re borrowing smartly, with a clear plan for returns.

Three Final Takeaways: Transform Your Funding Path

• Leverage the Infrastructure Boom: Don’t let banks’ caution stop you from grabbing new contracts or expansions.
  Asset-based solutions are tailor-made for this surge in demand.
• Collateral Is Your Secret Weapon: Equipment, receivables, or inventory can unlock capital without risking personal property or meeting sky-high FICO thresholds.
• Choose a Lender That Moves Fast: With Sunwise Capital, you skip the glacial pace of banks and get solutions typically within days—so you can secure deals before rivals.

Conclusion: Seize the Momentum with Asset Based Lending for Small Businesses

If you’ve felt that jolt of frustration—knowing your business is poised to explode, but the bank won’t budge—understand that “no” from them isn’t the final word.

I’ve been on both sides of the table: analyzing risk in Wall Street brokerage halls and cringing at bank rejections as a business owner.

That’s why Sunwise Capital built a framework to push beyond outdated lending hang-ups, focusing instead on your real assets and genuine growth potential.

With asset based lending for small businesses, you can harness your receivables, inventory, or equipment to capture bigger deals, purchase advanced machinery, or simply stabilize your cash flow in uncertain times.

Remember, the infrastructure wave or a big new contract won’t wait around while you juggle a 2-month bank approval.

So if your revenue is at least $300K, your credit score is 600+ (but 650 is even better), and you’re in business 3+ years (5+ is ideal), why not skip the frustration?

At Sunwise Capital, we empathize with your urgency and tailor financing that’s fast, transparent, and respectful of your industry’s ups and downs—be it seasonal landscaping, year-round medical clinics, or a manufacturing line ramping up for government projects.

It’s time to put your assets to work in a way that truly fuels your ambitions.

Don’t let stale bank standards stifle your potential.

Make your move.

Because if you’re ready to grow, and your assets can back you up, we’ll help you make it happen, swiftly and on your terms.

Looking for further insights on asset-based lending or the infrastructure boom?

Here are some credible resources:

• U.S. Small Business Administration (SBA) – Guidance on alternative financing.
• Bipartisan Infrastructure Updates – Track new infrastructure projects & timelines.
• Equipment Finance Advisor – Industry trends for machinery & lease financing.
• Construction.com – Latest construction data on roads, rail, and grid upgrades.
• NerdWallet’s ABL Guide – Quick primer on how collateral-based loans work.