Growing companies often need capital faster than traditional lenders can provide it. Third Eye Capital is a Toronto-based alternative credit provider that offers tailored financing to asset-rich companies going through growth, change, or transition. Private credit has become a practical option for businesses that need flexible terms, faster decisions, and a lender that understands their situation.
Unlike a standard bank loan, private credit is usually arranged directly between a lender and a borrower. This allows the structure to reflect the company’s assets, cash flow, and plans. The seven applications below show how that flexibility can support expansion.
1. Funding Acquisitions
A company may find a competitor, supplier, or complementary business to buy. Sellers often want certainty and speed, and a slow approval process can cost the buyer the deal.
Private credit can fund all or part of the purchase price. A lender may look at the combined company’s assets and earnings, not only the buyer’s past results. This can make larger or more complex deals possible.
A regional construction services firm wants to buy a smaller competitor with specialized equipment. A private lender provides a term loan secured by the combined equipment and receivables, so the deal closes within the seller’s timeline.
Acquisition debt adds repayment pressure. The buyer should test whether the combined business can support the loan if integration takes longer than planned.
2. Financing Working Capital Growth
Growth uses cash before it produces cash. A business that wins larger orders must buy inventory, pay staff, and wait for customers to pay.
A revolving credit facility lets a company borrow and repay as its needs change. Private lenders often set the borrowing limit against receivables, inventory, or other assets, so the facility can grow along with the business.
A consumer products company secures a national retail contract. Its revolving facility funds extra inventory and covers the gap between shipping goods and receiving payment.
Revolvers usually come with reporting requirements and borrowing-base rules. Owners should be sure their finance team can meet those obligations consistently.
3. Supporting Capital Expenditures
Expansion often requires physical investment, such as new equipment, facilities, technology, or production lines. These projects can take time to pay back.
Private credit can provide term financing matched to the useful life of the asset. Lenders with sector knowledge can also assess whether the project makes commercial sense.
A mining services company needs new machinery to take on larger contracts. A lender provides a multi-year loan secured against the new equipment and existing assets.
The repayment schedule should match when the investment is expected to generate returns. A mismatch can strain cash flow during the early stages.
4. Refinancing Existing Debt
A company’s current debt may no longer suit its growth plans. Maturities may be close, covenants may be tight, or the current lender may not support further expansion.
Private credit can replace existing debt with a facility built around the company’s current position and future plans. This can free management to focus on growth rather than repeated renegotiations.
A transportation company has a bank loan that restricts new investment. A private lender refinances the debt with more suitable terms and adds capacity for fleet expansion.
Flexibility can carry a higher price than bank financing. Companies should compare the total cost, fees, and covenants, not just the headline interest rate.
5. Bridging a Transition or Turnaround
Some businesses need capital while they restructure, change strategy, or recover from a difficult period. Traditional lenders may pull back during this time, even if the underlying assets remain valuable.
Private credit providers that specialize in special situations can lend to companies facing complexity or uncertainty. Their financing may come with hands-on support and a longer view of value creation.
A healthcare services business has closed unprofitable locations and is repositioning around stronger markets. A private lender provides financing that funds the transition while the new plan takes hold.
Lenders in these situations will expect close monitoring and clear milestones. Management should be ready to share candid information and act on agreed plans.
6. Unlocking Value in Non-Traditional Assets
Not every valuable asset appears on a conventional balance sheet. Technology companies, resource businesses, and energy firms may hold software, licenses, contracts, mineral reserves, or intellectual property that supports growth.
Some private lenders can evaluate these assets and lend against them. This allows companies to raise capital that banks may not offer because the collateral is harder to assess.
A software company with recurring contracts and proprietary technology needs funding to enter a new market. A specialist lender structures a facility around the value of its contracts and intellectual property.
Valuing non-traditional assets takes expertise and time. Companies should prepare thorough documentation to help the lender understand what they own.
7. Adding Preferred Equity to Strengthen the Balance Sheet
A company may already carry a fair amount of debt but still need capital to expand. Selling common equity can dilute existing owners, while more senior debt may be too heavy.
Private credit firms sometimes provide preferred equity or other hybrid capital. This can sit between senior debt and common shares, giving the company more capital without the full dilution of a common equity raise.
A growing energy services business uses senior debt for equipment and a preferred equity investment to fund a new regional location. The mix keeps ownership intact while supporting the expansion.
Preferred equity often includes dividends, redemption rights, or board representation. Owners should understand these terms and how they affect control.
Choosing the Right Private Credit Partner
The best private credit arrangement depends on more than price. Businesses should compare lenders on the following points:
- Experience in their industry and asset type.
- Speed and certainty of execution.
- Flexibility on structure, covenants, and repayment.
- Willingness to support the company through change.
- Transparency about fees and total cost.
A lender that understands the business can be a useful partner as well as a source of funds. That value is greatest when management brings a clear plan, accurate financial information, and realistic assumptions.
Making Private Credit Work for Growth
Private credit is not a substitute for a sound strategy. Debt must be repaid, and even a well-structured facility can create pressure if sales, margins, or timelines fall short. Before borrowing, companies should model several scenarios and identify how they would meet obligations if growth is slower than expected.
Used carefully, though, private credit can help businesses act on opportunities that might otherwise pass them by. Whether the goal is an acquisition, new equipment, a refinancing, or a turnaround, the right financing structure can give management room to execute. Firms such as Third Eye Capital show how tailored capital and practical guidance can help companies move from planning to expansion.