About CAP Funding Security
Success with CAP project funding comes from either having asset depth or knowing a company or person that does. Second best, having a network and the necessary skills to build a new relationship for that purpose.
Short-term Security is NOT investment. Assets or creditworthiness are used as security for CAP funding to assure project delivery — we guarantee delivery of this advantageous capital per a pre-approved, automated draw schedule in exchange for the client’s delivery of an operational project.
Is CAP funding a fit for you?
CAP stands for “Completion Assurance Program” — an innovative structure that delivers four benefits & advantages (or click on the image above to enlarge.) We are unusual in the world of project finance with far greater flexibility about the stage of readiness, leverage that can be used (100% funding at quite attractive terms), which can be faster, more streamlined and predictable than the traditional route.
How much asset depth is needed, and how long is security held?
- Sufficient non-cash assets to back a Standby Letter of Credit (SbLC) for ~50-75% of your required funding until project COD*, or
- Enough cash surety for minimum 25-35% of CAP’s total funding enables 3x-4x committed capital, then is returned in lump sum on the final drawdown of funds. Cash or an equivalent can come from a private bridge loan, a bank’s or private line of credit, sale of an asset, or cash on hand.
* Commercial Operation Date (COD) occurs when the project is built, commissioned and ready to begin operations.
In some cases, just the balance sheet (audited financial statement) is enough for the involved banker to agree that the applicant is sufficiently creditworthy to obtain the requested security — no specific collateral needed. Some of our VIP clients/sponsors have this capacity.
Next Steps to get started
Complete our fast initial assessment to provide your RAIN score so we can help recommend further steps. There are many options for Security, but an SbLC or cash surety deposit are by far the most popular (compare only these two).
To discover what’s best for your situation:
Know more about Security | Review practical tips for sourcing an SbLC | Compare all available Security solutions
Take advantage of CAP’s unique twist
CAP funding requires this security only until project delivery. That means we can deliver 100% of the project’s funding with no additional developer cash “skin-in-the-game” — no additional unexpended money invested in your project. This is very unusual … normally you would have to put in a pile of your own additional money or find an equity investor.
In3 CAP funding is fine with 100% of the required capital, at any reasonable stage of readiness, at great terms — funding in any currency, in any currency, without majority voting rights or interest expense, using predictable, security-centered, streamlined qualification.
When does Security get released?
SbLCs would remain “operative” until their maturity (expiration) following Commercial Operation Date (COD), once the project has been built and commissioned to begin operations, typically 1-2 years.
Cash surety deposits are held in a custodial account then released upon the final drawdown of funding, typically 15-25 months. For faster draws, use a higher percentage (35-40%) as the deposit.