What Are The Basic Functions Of A Leasing Company
  • Fund software/hardware purchases in return for payment over time
  • Take credit risk and software/equipment risk
  • Provide tailored solutions to customers needs
  • Proved a vendor the ability to offer the customer extended payment terms without having to finance the payments

Why Your Customers Use Leasing
  • 100% financing
  • Preserve bank lines - or eliminate the need for a line
  • Pay for software/equipment as they use it
  • Payments fixed and do not increase with interest rates
  • Avoid delays of capital budgeting process
  • For the middle-sized company - convenience
  • For the small or new company - an excellent source of funds
  • Simple documentation

What Is Software Leasing
  • Method of paying for software over time instead of a single upfront payment
  • The functional equivalent of a loan from the leasing company
  • Structure that can be tailored to meet the specific needs of a customer

What Can Software Leasing Do For A Software Company
Shorten the sales process
  • No upfront payment
    Offer convenience to your customer
    Remove capital budget delays

  • Expand your customer base

  • Better satisfy customer needs
    Tailor the lease to the need

  • Improve your competitive and financial position
    Reduce your receivables and increase your cash
    Having a leasing program gives you a competitive advantage

What To Look For In A Leasing Company
  • Experience in leasing
  • Experience in your business or the software/equipment
  • Reputation, particularly for fair dealing
  • Service
  • Efficiency
  • Financial strength or access to capital
  • Competitive pricing

How To Do Business With A Leasing Company
  • Explain your business
    Software Characteristics
    Customer Characteristics
    Distribution Methods
    Pricing-Per Item and Average
    Plans for the Future
  • Discuss if and how leasing might favorably impact your business
  • Discuss how a leasing company will interface with your customers
  • Discuss administrative aspects of the relationship

What A Leasing Company Looks For - Ideally
  • Acceptable credit risk
  • Some risk protection from value of software/equipment or other collateral
  • Acceptable return for the risk
  • Potential upside from software/equipment at the end of the lease
  • Maybe some tax benefits
  • Some minimal level of business

© LPI Software Funding Group, Inc.  

593 Cricket Lane, Suite 200     Wayne, PA 19087  

610.687.4434      610.341.6100
                         February 27, 2006