Corticon

A Leading Software Provider Attracts Large Customers

Corticon enables organizations to make better, faster decisions by automating business rules with their enterprise-level rules software. The company offers a patented “no-coding” rules engine that helps organizations automate their most sophisticated decision processes, eliminating the need for a complex rules coding language and an expensive IT capability. Among Corticon’s 450-plus customers are some of the largest companies in the world including CIGNA, Unum and eBay, and government agencies such as the OPM (Office of Personnel Management), the FBI and the USDA (U.S. Department of Agriculture).

“We offer the most innovative rules software on the market,” said the company’s chairman of the board, George Sollman. “Our automated decision management systems empower organizations to improve productivity and customer service, and adapt quickly to changing market conditions.”

Fueling Growth, Keeping Equity

Since its founding over a decade ago, Corticon has grown rapidly. Most recently the company reported 82% growth in its fourth quarter 2010 when compared with the previous year. Much of that growth has been fueled by business from some of the world’s leading companies and large government agencies.

As important as these large organizations are to Corticon’s future, growth increases the need for cash. The company is venture capital funded and has a line of credit to fund day-to-day operations, but in 2010 its executives decided to seek out an additional source of capital to maximize their ability to grow and take on new business. They began to look for the most flexible way to finance further growth that would be non-dilutive to their current investors.

Discovering The Receivables Exchange

Corticon found the ideal solution with The Receivables Exchange, the real-time online marketplace for working capital financing. Corticon’s CEO, Mark Allen, first heard about the Exchange at a conference for the Young Presidents’ Organization, and it seemed to be the ideal financial solution that his company was looking for to finance growth efficiently and affordably, without giving up equity. The Exchange allows the company to monetize receivables into working capital almost instantly. With ready access to capital, Corticon has an ideal cash source as it grows to take on larger contracts.

“Quite simply, The Receivables Exchange has provided the most efficient way of financing our rapid growth,” Sollman said. “No other financing method gives us the flexibility and control over our working capital that the Exchange provides.”

Corticon joined the Exchange in August of 2010, and has auctioned receivables ranging from $20,000 to seven figures in value. Since the company began selling high-quality receivables on the Exchange’s working capital marketplace, it has seen its cost of capital decrease significantly.

“Our price has come down a full percentage point from where we started,” said Corticon’s senior manager of finance, Aditya Kapoor. “The Exchange’s pricing is absolutely competitive with other financing options available to us.”Kapoor said The Receivables Exchange has been extremely easy to use, and it fits seamlessly with Corticon’s existing financing. There are no contracts, personal guarantees, or monthly minimums. The company can use the Exchange when it needs an infusion of working capital, but it is not saddled with the onerous constraints of traditional financing.

Capital for Future Growth

As more and more companies see the value of streamlining their rules processes, Corticon is in high demand. The company expects growth to continue through 2011 and beyond – growth that will have to be financed.

“It’s reasonable to say that in this next year, our growth could be a minimum of 50% over the prior year,” Sollman said. “Needless to say that rate of growth has implications on cash needs. We continue to rely on The Receivables Exchange as a primary source of working capital financing.”

He added, “The Receivables Exchange facilitated the ability for us to enter a high-growth phase with premier customers. It’s possible we could have done it another way, but no other option is as fast, flexible – and equity efficient – as The Receivables Exchange.”