Insights

For many founders and CFOs evaluating financing options, one of the first questions is whether their company is better suited for cash flow lending or asset-based lending (ABL). Both structures can provide meaningful access to capital, but they operate very differently. Cash flow loans are typically sized based on earnings performance and credit metrics, while asset-based lending facilities are structured around specific collateral such as receivables, inventory, or equipment

Inventory financing plays an important role in sectors such as retail, direct-to-consumer (D2C), and manufacturing. This is evident in the growth of the global asset-based lending market, projected to reach $891.89 billion in 2025 and surpass $1 trillion by 2026 .¹ In higher-rate and more volatile environments, lenders have placed greater emphasis on downside protection within credit structures. While cash-flow underwriting remains central to most private credit transactions