What debt readiness actually means for a $5M company
60-second TL;DR
At ~$5M, debt readiness is not a bigger line of credit — it is proof the business can carry obligations: reliable reporting, owner-independent ops, and capital deployed with intent.
Core ideas
- • Financial package: trailing P&L, balance sheet, bank statements, tax returns — consistent with how you operate
- • Cash flow narrative: where money comes in, what is fixed vs. variable, and what happens in a 20–30% revenue dip
- • Operational proof: roles, handoffs, and systems so the business is not hostage to one person
- • Use of funds: inventory, payroll bridge, equipment, or refinance — matched to structure (MCA vs. term)
- • Ops layer: if collections, forecasting, or margin are weak, fix operations before stacking debt
Next steps
Capital works best with operations and continuity in view — not in silos.