PE-backed growth companies face a constant balancing act. On one hand, sponsors demand aggressive expansion; on the other, lenders watch leverage and liquidity closely. Too often, CFOs and treasurers are forced to use their revolver for routine working capital needs—when that facility should be reserved for strategic initiatives or true emergencies.
That’s where alternative capital solutions come in. By unlocking liquidity trapped in receivables and payables, finance leaders can take pressure off their revolvers, maintain sponsor confidence, and keep capital available for growth or M&A activity.
The Revolver Pressure Problem
Consider a mid-sized telecom company scaling digital services while investing in IT infrastructure. Despite strong growth, day-to-day liquidity needs forced repeated revolver draws, triggering concerns from its lenders. By introducing a receivables financing program, the company freed up liquidity without touching the revolver, preserving borrowing capacity for expansion.
In another case, a packaging manufacturer growing in pet food faced earnings volatility after a customer bankruptcy. Alternative capital solutions allowed the CFO to fund M&A activity without leaning on the revolver, improving optics with both sponsors and creditors.
Growth Without Revolver Dependency
A European industrial group recently implemented a payables finance program across divisions, creating liquidity to fund transformation initiatives while keeping its revolver fully available. This not only improved the company’s balance sheet optics but also reassured lenders ahead of a potential exit event.
Meanwhile, a global packaging firm carrying high leverage had access to an unused ABL facility, but its rigid terms offered little flexibility. By shifting to an alternative capital program, the CFO unlocked faster, more flexible working capital while maintaining revolver headroom for larger, strategic needs.
Strategic Growth Requires Strategic Capital
From tech acquisitions to supply chain expansions, strategic moves require working capital that can be deployed quickly and flexibly. Alternative capital makes this possible by funding growth through receivables and payables programs, not revolver draws – strengthening balance sheet optics and preserving sponsor confidence.
Why Now?
- Economic and geopolitical uncertainty, volatile supply chains and postponed IPOs all make traditional financing less reliable. The Office of the CFO needs solutions that are:
- Resilient: Liquidity that flexes with growth cycles
- Responsive: Working capital that deploys quickly when opportunities arise
- Non-dilutive: Funding that avoids tapping the revolver or adding leverage
Swap Revolver Strain for Alternative Capital
If your company is relying on revolver draws to fund working capital, it’s time to explore GSCF’s alternative capital solutions. These solutions unlock liquidity, preserve borrowing capacity, and give CFOs and treasurers the flexibility to grow on their terms.rnative capital solutions. These solutions unlock liquidity, preserve borrowing capacity, and give CFOs and treasurers the flexibility to grow on their terms.
