Fueling Business Growth with Early Pay

By: Charlotte Ng, Co-Founder & Chief Product Officer, OneAM
Published Thursday, April 24, 2025 | Estimated read time: 3 min

When we talk to small-to-midsized businesses, the most exciting topic that comes up is their tremendous growth. Just in the last few days, we spoke to a technology firm growing at a clip of 75% a year, a nascent media company winning new contracts with high-profile customers, and a consultancy having to turn down new business due to demand overwhelming their capacity. As business owners ourselves, we feel energized hearing about these successes, and even more energized to hear that OneAM’s receivables finance solution can help these businesses grow.  

Quantifying incremental growth 

Receivables finance is a non-debt, non-equity solution that can help businesses unlock growth without taking on a balance sheet liability or raising expensive, dilutive equity. A simple, back-of-the-envelope way to quantify how much potential growth an early pay solution can enable is to look at how efficiently a company is able to use their current capital stack to generate sales: 

Sales on Invested Capital = Sales / (Debt + Equity – Cash)*  

To illustrate the math, let’s say an Oil & Gas service provider generates $10 million in sales a year, and has $1 million cash, $4 million debt, and $3 million in equity: Sales on Invested Capital = 10 / (4 + 3 – 1) = 1.67 

With Sales on Invested Capital of 1.67, for every $1 of capital, this business is generating $1.67 in sales. If the business converts their accounts receivables into $1 million of additional working capital over the year, applying the same ratio, the business would be able to unlock $1.67 million in incremental sales, or 16.7% growth in this example.  

*If you want to be more conservative, you can use Sales on Net Capital Employed = Sales / (Debt + Equity + Cash Required for Operations) which will give you a more tempered ratio.  

It’s not just pricing: structure matters—a lot 

In comparing early pay solutions, most people focus on pricing, i.e. discount rates over a financing period. What we find is structure matters a lot in determining both the actual and opportunity cost of financing. What we typically see in traditional factoring—origination fees, accrued collection fees, late fees, marked-up bank charges, held reserves, etc.— will impact what the business will ultimately get in early payment, and how much incremental growth this can drive. This will add up to a meaningful difference cycle after cycle.   

At OneAM, our pricing and contractual structure is designed to be streamlined and transparent, i.e. no hidden fees, translating to higher tangible growth benefits. And unlike a loan /line of credit, which adds liability and will stay expensive in the current high interest environment, or equity, which is dilutive and erodes control, OneAM enables businesses to unlock liquidity from their A/R quickly and plow this cash back into growth. 

OneAM connects businesses selling receivables with sophisticated institutional investors, offering a faster, more business-friendly alternative to traditional factoring. For businesses constrained by working capital shortfalls, OneAM offers an easy-to-use, flexible solution that fuels their growth.  

Learn more at our website or schedule a demo at info@oneam.us.