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Who We Are
Blue Hen offers a low-risk factoring opportunity with Eligible Telecom Carriers (ETCs) in the Lifeline Program, realizing government receivables. This opportunity provides a superior return, and is a short-term commitment. Our lenders always receive cash flows back before Blue Hen realizes any profit.
What Is Factoring?
Factoring, or invoice financing, is an alternative financing method used by businesses and corporations to improve their cash flow and growth. When the monthly government receivables are realized, Blue Hen will pay the monthly third-party telecom charges and other third-party fees. Thereafter, all funds are segregated within that tranche until all lenders are paid back in full, plus the stated interest.
Start Factoring With Blue Hen Today.
How It Works
Legal Setup
Blue Hen prepares the commercial loan documents that include a security agreement for the lender for which monies are due within 30 days. Until its lenders are repaid, Blue Hen only collects 5% of monthly revenue during the life of that tranche.
Lifeline Distribution
Blue Hen purchases and delivers phones and wireless service to Lifeline recipients using established distribution channels to secure customers who are eligible for government-subsidized funding under the Lifeline Program. All fixed expenses are paid upfront within 60 days, so only the net revenue is realized thereafter.
Lifeline Services
Blue Hen serves Lifeline customers with phones and wireless service and oversees government compliance. Blue Hen also pays all monthly telecom charges to the ETC and carriers (such as Sprint) to retain the customer and receive the monthly government payments.
Tranche Repayment
Blue Hen accumulates monthly net monies and typically starts to pay back lenders within the fourth month. Another payment typically follows in approximately six months, and full principal and interest are paid within nine months. Unlike typical loan repayments, Blue Hen begins to pay back the tranche early as a courtesy to its lenders.
Residual Cash Flows
Once the lenders are all paid back in full, Blue Hen realizes a smaller return from operations each month as some customers change telecom providers or upgrade their phones with Blue Hen or another telecom provider. Blue Hen expects that with attrition, nearly all customers will be gone within two years, hence the continuing need for tranches.