Covid taught us liquidity is life. A simple three-part kit keeps you breathing if revenue stops for a quarter. ComponentTargetStorageCash buffer1 month OPEXHigh-yield money-market fundStandby line15 % of annual revenueUndrawn credit facilityInvoice-finance limit80 % of average receivablesOn-call Activation Order 1. Draw invoice line for operating cash. 2. Tap standby only if buffer
Leverage is fine; over-leverage sinks ships. Red-Flag Ratios 1. Total Debt / EBITDA > 4× 2. Short-Term Debt > 60 % of total 3. Fixed-Charge Cover < 1.2× Quick Stress Drill * Drop revenue 20 %. * Add 200 bps to interest rates. * If any ratio breaches covenants, talk to lenders before they call
Not all loans pay back the same way. Pick the wrong shape and you’ll feel it at month-end. ShapeHow It PaysBest ForCaution FlagBulletOne lump sumAsset flips, property resaleBig balloon riskAmortisingSame amount every monthSteady revenueHurts if sales dipRevenue-Share% of monthly salesSeasonal brandsLonger tail if growth slows DIY Test Drop the
Due-diligence teams love neat spreadsheets. A messy debt stack, however, can slash the multiple on your exit valuation. Seven-Item Cleanup Checklist 1. Reconcile inter-company loans; eliminate circular balances. 2. Close dormant bank accounts—one less KYC headache. 3. Extend any bridge loans shorter than 12 months. 4. Secure board consents
A working-capital line, an overdraft you’ve outgrown, and a three-year term loan—sound familiar? Knowing when to keep, switch, or clear each facility can add points to your net margin. 90-Second Decision Grid Cash CushionInterest-Rate TrendGrowth PipelineBest MoveTight (< 1 month)RisingFull order bookRefinance into longer tenor to cut
Licencing, visas, banking—founders compare zones, but overlook working-capital mechanics. Cash-Flow FactorFree-ZoneMainlandCOD settlement lag+3–7 days*Same-dayImport duty timingPay on re-exportPay at portLocal bank clearingOften T+1Real-time *Some courier partners batch-settle free-zone collections weekly. Decision Tips 1. Draw a CCC table for both setups—extra days equal real cash.
Input-VAT refunds often take 45–60 days to hit your bank. Meanwhile, suppliers still want cash. Two-Step Solution 1. File fast, file clean * Submit e-Form 311 by the 28 th. * Upload invoices in FTA-approved XML or PDF. 2. Use a VAT-bridge facility Draw only the expected refund amount; tenor = FTA
Many founders still think ESR only applies to offshore firms. Wrong. If your mainland or free-zone company earns income from distribution, HQ services, financing, IP, or holding activities, you must file an ESR return. Three-Point Compliance Map 1. Do the “relevant-activity” quiz Tick any activity that fits ESR guidance—holding
Since February 2023, Federal Decree-Law (3) says UAE buyers must pay business-to-business invoices within 30 days unless the contract states otherwise. For SMEs, that shrinks the “I’ll pay you next month” excuse. What Founders Should Do 1. Rewrite payment terms Put “net-30 (UAE Decree-Law 3/2023)” on every invoice
Switching to EV vans can cut per-drop costs—but batteries, chargers, and training pull cash forward. 30-Day Game Plan 1. Days 1-5: Finalise specs, bulk discount with EV vendor. 2. Days 6-12: Apply for any UAE green-transport grant. 3. Days 13-18: Sign battery-lease deal—drops capex 25 %. 4. Days 19-24:
Buying an MRI or digital X-ray machine ties up millions. Leasing can free cash, but loans may be cheaper long-term. FactorLeaseLoanUp-front cashLowHighTech refreshEasy swapRigidAccounting impact (IFRS 16)*Off-balance (small deals)On-balance *Small operating leases can still stay off-balance sheet; check limits. Quick Rule: If the tech will be obsolete in
White Friday can double monthly sales for cosmetics—but only if shelves are full. Inventory Checklist 1. SKU Audit: Rank last year’s sell-through; focus cash on the top 20 %. 2. MOQ Negotiation: Push suppliers for smaller lots on slow movers. 3. 60-Day Inventory Loan: Covers deposit, freight, and customs;
Schools pay tuition in term blocks; EdTech platforms often bill parents monthly, creating mismatch. Three Practical Fixes 1. Early-Bird Discount: Offer 5 % off for annual pre-pay; fund deferred service delivery with a low-rate term loan. 2. 45-Day Receivable Gap Line: Match loan tenor to the typical time between invoice and
A delivery-only kitchen proved product-market fit. Now you want a street-level café—but fit-outs, licences, and equipment can top AED 1.2 million. Capital Stack SpendFinance ToolTenorKitchen equipmentLease4 yrsFit-out & décorTerm loan3 yrsLaunch marketing12-month revenue-share line1 yr KPI Targets * Café EBITDA breakeven by Month 9. * Debt-service-coverage ratio > 1.3×
Raising equity in a cooling market can crush valuation. A small “bridge” loan buys time—if you size it right. Decision Grid SituationBridge LoanEquity Top-UpNeed < 6 months runway✔✘Valuation dip expected✔✘Strategic lead investor secured✘✔ Sizing Formula Bridge Size = Net Burn × Months Needed + 10 % Buffer Align repayment to the
Great products don’t sell themselves. Yet payroll for five reps (AED 8 k salary + commission) can feel heavy before they hit quota. Timeline & Funding Match * Months 0–3 (Ramp): Draw an interest-only loan that covers net payroll; no principal until reps generate revenue. * Months 4–6 (Growth): Shift