As an early-stage, high-growth software company, Market6 needs significant processing power, but it also must keep working capital available for building its core business.
When Market6 needs new IBM hardware, it uses fixed-rate loans from IBM Global Financing to amortize the purchases over several years. This frees up working capital, enabling the organization to focus spending on its core business.
Drives growthby freeing up capital for the pursuit of new opportunities
Reduces workbecause the financing and hardware teams operate in tandem, simplifying loan discussions
Can protect against calamityby allowing the company to maintain a cushion with its primary lender
Business challenge story
When Market6 was founded, the executive team made the strategic decision to use the IBM® PureData® System for Analytics, powered by Netezza® technology, because of its sheer processing power and the at-rest encryption technology many Market6 customers required. Each time Market6 takes on a new customer, it reevaluates its IT infrastructure and procures additional servers if necessary.
“We do not believe in investing our working capital in fixed assets, so purchasing equipment as a lump sum payment has never been an option for us,” says Al Wallander, Market6 chief financial officer. “We prefer to focus our working capital on our core business.
Wallander explains: “It’s a one-stop shop. Because the hardware also comes from IBM, the financing team already has a deep understanding of the purchase. Instead of spending weeks explaining ourselves, we can get a competitive loan with one signature on one document.”
That’s why the organization works directly with IBM Global Financing to procure new data warehousing appliances using 42-month fixed rate loans. So far, Market6 has secured three loans with IBM.
Maintaining a lending cushionLike many businesses, Market6 also has a strong lending relationship with a large commercial bank, and the company once considered financing new hardware through that lender. However, as Wallander explains, choosing IBM Global Financing helped protect Market6’s commercial lending relationship in a valuable way.
“In a relationship with a bank, there is always a theoretical lending limit. We like to keep a cushion there in case our business situation changes. There’s always the chance that a significant, unanticipated event could happen, and we want to be sure we’ve got enough surplus lending capability to weather the storm.”
Remaining flexibleMarket6’s 42-month term loan with IBM Global Financing also helps the company stay nimble enough to jump on new opportunities anytime they arise.
“With unencumbered capital, it’s easy for us to take a core internal group, join forces with an external team and, in a short period of time, build out a customized product offering that we can deliver to the market quickly,” says Wallander.
And opportunity, he notes, is knocking. “Right now, not a month goes by that we don’t identify a very significant opportunity that has very significant revenue attached to it.”
Further, the next time Market6 needs new hardware to support a new customer, Wallander and his team plan to use IBM Global Financing to make it happen. “It’s become our vehicle of choice because it’s just so easy,” he concludes.
Founded in 2006 in Deerfield, Illinois, in the US, Market6 is a software company that helps bridge the gap between retailers and suppliers. Using sophisticated analytics and collaboration tools, the business facilitates rapid, seamless communication among thousands of suppliers and some of the US’s largest high-turnover retail chains, keeping shelves stocked and operations lean. Market6 employs approximately 90 people.
Take the next step
To learn more about IBM Global Financing solutions or the IBM PureData System for Analytics, powered by Netezza technology, please contact your IBM marketing representative or IBM Business Partner, or visit the following website: ibm.com/financing