How a $420,000 invoice factoring facility helped a Texas electrical contractor secure its second million-dollar contract

Industry: Commercial electrical subcontracting
Location: Dallas-Fort Worth Metroplex, Texas

Problem:
Net-60 payment terms locked up $420,000 in receivables while weekly payroll and materials costs kept running.

Solution:
Swoop arranged an invoice factoring facility with an 85% advance rate and a 48-hour cash turnaround.

Results: $1.4M second contract won | 35% revenue growth in first fiscal year | Headcount grew from 22 to 31

Illustrative case study. This story is based on a real deal arranged through Swoop. Specific figures, location details, and other identifying information have been adjusted to protect the client’s confidentiality at their request. The funding structure, outcomes, and commercial dynamics described are representative of the actual transaction.

Challenge

The electrical conduit was running. The panel boards were going in. The invoices were stacking up. But for a 22-person electrical subcontracting firm working one of the fastest-growing construction corridors in the country, the money was moving in entirely the wrong direction.

The firm had just won a $2.1 million contract to handle all electrical installation on a new mixed-use apartment complex in Frisco, Texas – one of the most active suburban development markets in the Dallas-Fort Worth Metroplex. The general contractor was a well-established regional builder with a solid track record and a fully permitted, bonded project. By every measure, this was exactly the kind of contract a subcontractor spends years trying to win.

The problem was buried in the payment terms.

Like most commercial general contractors, this one operated on Net-60 billing cycles. Work completed in week one got invoiced at the end of the month. Payment arrived (if it arrived on schedule) two full months after that. In practice, the gap between pulling wire and cashing a check regularly stretched to 75 or 80 days.

For a business carrying a full-time crew of 22 licensed electricians, that gap was brutal. Weekly payroll ran between $55,000 and $65,000. Materials: wire, conduit, distribution panels, fixtures had to be purchased before work could begin, not after the invoice cleared. At any given point in the project, the firm had between $380,000 and $450,000 of completed, unpaid work sitting in accounts receivable.

Their checking account couldn’t absorb that kind of float indefinitely. And with a second major contract going to tender in 90 days, draining reserves to cover daily operations was not an option. They needed a way to unlock the cash already sitting inside their own invoices, without waiting two months for the GC’s accounts payable team to get around to it.

Solution

Swoop’s funding team structured a $420,000 invoice factoring facility through a specialist construction finance lender, with an 85% advance rate against verified receivables and a 48-hour cash turnaround from invoice submission.

The mechanics were simple. Each time the firm completed a billing milestone and submitted an approved invoice to the general contractor, they uploaded a copy to the factoring platform. Within two business days, 85% of the invoice value (the “advance”) landed in their checking account. The remaining 15%, minus the factoring fee, was released once the general contractor paid in full, typically on or around the Net-60 due date. The factor handled all collections and payment follow-up, removing that administrative burden from the firm’s two-person back-office team entirely.

The advance rate mattered in practical terms. On a $100,000 invoice, $85,000 hit the account almost immediately – enough to cover two weeks of payroll and a fresh materials purchase without touching reserves. The factoring fee was built into the overall project margin at bid stage, so there were no surprises on the profit and loss statement mid-project.

Because the facility was secured against the invoices themselves rather than personal assets or business property, the firm’s principals did not need to pledge their homes or equipment as collateral. The lender’s underwriting focused primarily on the creditworthiness of the general contractor (a well-capitalized commercial builder with a clean payment history) rather than solely on the subcontractor’s balance sheet. That distinction opened a door that a traditional bank line of credit, which would have required two years of tax returns, a personal guarantee, and a six-week approval process, almost certainly would not have.

The facility was live within five business days of the initial Swoop inquiry. The first advance against the Frisco project invoices followed two days after that.

Result

With cash flowing against invoices rather than sitting idle in accounts receivable, the firm ran the $2.1 million Frisco project to completion without a single payroll delay or materials shortage.

The immediate effect was operational stability. The crew stayed intact. No layoffs, no reduced hours, no scrambling for short-term bridge financing between billing cycles. Materials were ordered on schedule, which kept the project on its construction timeline and avoided the costly rescheduling fees that have become common across the DFW commercial building market.

The strategic effect was larger. When a tender for a 65,000-square-foot medical office complex in Plano came to market three months into the Frisco project, the firm had the cash position to bid confidently. The second contract was worth $1.4 million. They won it.

Running both projects simultaneously, which would have been impossible with a cash-constrained balance sheet, pushed the firm’s annual revenue from $2.7 million to $3.65 million in its first full fiscal year using the facility, a 35% increase. Headcount grew from 22 to 31.

The factoring facility also delivered a benefit the team hadn’t fully anticipated: the factor’s professional collections process shortened the average payment cycle from 72 days to 58 days. Having a dedicated third party managing invoice follow-up – rather than the firm’s owner chasing the GC’s AP department directly – turned out to matter as much as the advance rate itself.

More projects. Larger crew. Faster cash. Less chasing.

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