Industry guide
Business finance for it and technology
Technology businesses buy hardware and licences for clients before those clients pay, and increasingly sell everything as a monthly subscription. Both create a funding gap.
IT and technology finance is lending to managed service providers, software businesses and IT resellers, funding hardware for client deployments, software and licence costs, and the working capital of recurring-revenue models.
A managed service provider deploying infrastructure for a client typically purchases servers, switches, endpoints and licences on distributor terms of 30 days, installs over several weeks, then invoices — with payment landing 30 to 60 days after that. On a large deployment the MSP is effectively bankrolling its client. The shift to as-a-service pricing has made this worse in cash terms and better in business terms: recurring monthly revenue is more valuable and more stable, but the hardware is still bought up front while the revenue arrives in small monthly slices for three years.
Software and SaaS businesses have a different shape again, with almost no hard assets but significant cash consumed by product development and customer acquisition ahead of revenue. Lenders assessing technology businesses have become more comfortable with recurring revenue as a basis for lending, though asset-light balance sheets still limit how much conventional secured lending is available. Where the business owns nothing that can be repossessed, expect the assessment to focus on contracted recurring revenue, churn and director security.
The cash-flow pattern we plan around
Hardware and licence costs paid on 30-day distributor terms against client invoices settled 30–60 days later, or recurring monthly revenue that recovers up-front costs across a multi-year contract.
What it and technology typically fund
- Servers, networking and endpoint hardware for deployments
- Software licences and subscription costs
- Funding hardware sold on as-a-service contracts
- Hiring engineers ahead of contracted revenue
- Office and lab fit-out
Documents lenders usually ask it and technology for
- ABN and two years of financials or 12 months of bank statements
- Contracted recurring revenue schedule
- Distributor quote or purchase order for hardware
Finance options for it and technology
Technology finance for it and technology
Technology finance exists because IT purchases do not behave like machinery. It funds hardware, software licences, implementation labour and even cloud commitments as a single facility, typically over three years — the same length as the client contract the deployment supports.
Equipment loan for it and technology
Where a technology business is buying hardware for its own use — a lab, a data centre rack, workstations for a growing engineering team, testing equipment — a straightforward equipment loan over three years is usually the cheapest structure. IT hardware depreciates quickly, so lenders keep terms short and balloons small or absent.
Unsecured business loan for it and technology
Unsecured lending suits asset-light technology businesses that have nothing conventional to secure against. A term loan can fund a hiring push ahead of contracted work, a product build, or the working capital gap on a large deployment.
Business line of credit for it and technology
A revolving limit fits the distributor cycle neatly: draw to pay for hardware and licences when the distributor account falls due, repay as client invoices clear, and hold the limit for the next deployment. Interest applies only to what you use.
Invoice finance for it and technology
IT resellers and project-based integrators often have a debtor book full of solid corporate and government clients paying on 45 or 60-day terms. Invoice finance advances against those invoices on issue, releasing the cash tied up in completed deployments.
Operating lease for it and technology
An operating lease keeps hardware off the balance sheet, treats the payments as an operating expense, and hands the residual value risk to the financier — which matters enormously with IT equipment, where a four-year-old server has almost no market value. For MSPs offering device-as-a-service to clients, an operating lease on the underlying hardware mirrors the contract you have sold and removes the disposal problem at the end.
Assets we finance for it and technology
Lenders active in this space
Flexicommercial, Moneytech, Banjo, Shift — among others on our panel of 18+. Your broker checks fit before anything is submitted.
Key terms
Technology finance
Technology finance is lending for IT hardware, software licences and cloud services, often structured so that a three-year hardware purchase is repaid over the same term as the client contract it supports.
Recurring revenue lending
Recurring revenue lending is an assessment approach that sizes a facility against contracted monthly subscription income and customer churn rather than against physical assets or historical profit.