Your SaaS company is doing really well. You built a great product, signed contracts, and your customer base is growing. Everything seems good, except for one big issue: cash flow. Many big clients take 30, 60, or even 90 days to pay their invoices, but your costs don’t wait. You still need to pay your developers, cover cloud hosting, and take care of other bills right away.
That’s why turning those unpaid invoices into cash quickly is so important. Invoice factoring might be the answer you’re looking for.
Real Story: “We Almost Paused Hiring, Until Factoring Stepped In”
“Our platform was growing fast. We signed a Fortune 500 client, but their Net-60 payment terms left us at a disadvantage. We had engineers ready to hire, but the money was tied up in outstanding invoices.
The bank didn’t get our business model. They wanted assets we didn’t have. A vendor told me about invoice factoring. Within a week, we received cash from invoices that had been sitting there for just a short time.
That one move kept us on track. We didn’t pause hiring, we didn’t give up ownership, and we didn’t take on debt. Now we use factoring all the time as part of our funding strategy.” — Taylor K., Co-Founder of a SaaS company in Austin, TX
Cash Flow Challenges SaaS Companies Face
If you sell SaaS to businesses, you know the problem:
- Many enterprise clients have long approval and procurement processes
- Payment terms usually stretch to 30–90 days
- Your receivables pile up while you wait to get paid
But during that time, you still have to:
- Pay engineers, developers, and customer support
- Cover hosting, infrastructure, and compliance costs
- Fund sales and onboarding for new clients
- Keep customer success running smoothly
Payment delays can create significant pressure on your business operations.
Invoice Factoring Made Simple for SaaS
Factoring is easy to understand. Instead of waiting months to get paid, you sell your invoices to a factoring company. They give you up to 95% of the money right away. When your client pays later, you get the rest, minus a small fee.
It’s not a loan. You don’t give up equity. It’s just your money, faster.
How Factoring Helps SaaS Grow
Factoring works really well for SaaS companies that sell to businesses because:
- Quick cash: You usually get funding within 24 hours
- Keeps hiring on track: You can pay your team without worrying about late payments
- Grows with you: The more invoices you have, the more cash you can unlock
- No debt or dilution: You keep full ownership of your company
Key Stats on SaaS Payment Delays and Factoring
- The average SaaS sales cycle for enterprise clients is 84 days, and payments can take even longer.
- Invoice factoring is one of the fastest-growing alternative funding tools for B2B companies.
Which SaaS Companies Use Factoring?
Factoring helps many types of SaaS companies, including:
- Startups signing big clients with long payment terms
- Growing SaaS firms bringing on multiple new clients
- Companies are tired of waiting on slow-paying corporate or government customers
- Founders who want non-dilutive funding and steady cash flow
If your SaaS sells to businesses, factoring can be a great fit.
FAQ: How Factoring Works for SaaS
Q. How fast can SaaS companies get funded?
A. Usually within 24 hours once your account is ready.
Q. Do I have to factor every invoice?
A. No. You choose which invoices to sell.
Q. Will my clients care?
A. Not really. Your clients will send payments to a lockbox in your name. Nothing will change for them except this.
Q. Do many factoring companies work with SaaS businesses?
A. No. Only a few factors specialize in SaaS. That’s why you need a partner who understands subscriptions, recurring revenue, and enterprise billing cycles.
Finding the Right Factoring Partner for SaaS
Not every factoring company understands SaaS. Many only focus on industries like trucking or staffing. But SaaS is different. It’s based on contracts, subscriptions, and recurring revenue.
We connect SaaS managers with factoring partners who know:
- Enterprise billing cycles
- Subscription-based invoices
- ARR and MRR growth patterns
- The balance between product development and cash flow
Ready to See If It Fits Your SaaS?
We’ve helped SaaS companies, from startups to scale-ups, find the right factoring partner. Our experts match you with funders who know SaaS. No pressure, no wasted time, no cookie-cutter offers.
Reach out now and let us guide you to a factoring partner who understands SaaS and can keep your cash flow on track.
Analia Miguel is an MBA and former CPA with 20+ years in business finance and marketing, including 14 years in alternative business finance. She helps business owners understand their funding options and choose cash flow solutions that truly fit their needs.
Last Updated: September 30th, 2025
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