By the end of this trailYou can explain why factory work is treated as unsecured and what would change that, model the deposit-to-draw gap on a project, distinguish backlog from pipeline in a manufacturer's numbers, place any factory in one of three tiers, and read the market-sizing you are shown with its denominator exposed.
  1. Step 01

    Understand why the collateral is somewhere else

    Construction lending assumes work happens on the site an inspector can visit. In modular, most of the value is created in a factory the lender does not control, on modules the borrower does not yet own. Everything else follows from that.

    You should now be able to answerAt what point does title to a module pass, what secures the material deposit before that, and who bears the loss if the factory fails mid-production?
  2. Step 02

    Model the deposit-to-draw gap

    A 5% LOI deposit six months out, 25%+ for materials three months out, then 30–35% at module start and completion, invoiced every two to four weeks — against a lender draw schedule that pays for installed work. The gap is equity, and it is why modular projects need more of it.

    DoTake a real or hypothetical 100-unit project. Lay factory billing against your standard draw schedule month by month. Note the peak gap and how many months it persists.
    You should now be able to answerWhat structures — factory inspection you trust, title transfer at station, escrowed deposits, a manufacturer completion guarantee — would let you advance against modules in production?
  3. Step 03

    Distinguish backlog from pipeline

    Factories fail on pipeline and survive on backlog. Harbinger cited a long-term pipeline of forty-plus projects while issuing a WARN notice. Price a factory's fixed costs against contracted, funded orders only.

    You should now be able to answerOf the orders in the deck, how many are executed contracts with financing closed, and how many months of line time do they represent?
  4. Step 04

    Place the factory in its tier

    Platforms with balance sheets, regional specialists merging for scale, and venture-era factories on the next raise: the 2026 transactions drew the lines. Tier predicts survival better than technology, mission or customer logos.

    You should now be able to answerWho carries this factory's fixed costs through two quarters with no new orders, and what is that party's own runway?
  5. Step 05

    Read the one public filer

    Boxabl's Nasdaq listing means that, for the first time, a volumetric factory must disclose output, revenue and cost quarterly. Whatever you think of the company, its 10-Qs are the only audited production data in the sector. Read them for the disclosure pattern, not the stock.

    You should now be able to answerWhat unit-cost and units-per-quarter figures can you extract from the filings, and how do they compare to the capacity claims made before listing?
  6. Step 06

    Expose the denominator in the market sizing

    You will be shown $111 billion, $208 billion, $229 billion. Global forecasts diverge by a factor of two because 'modular' has no agreed boundary. The addressable market for a North American volumetric factory is closer to MBI/FMI's $20.5 billion, and its share is five percent.

    You should now be able to answerWhich market figure is in the deck, what does it count, and what is the borrower's realistic addressable share of it?
  7. Step 07

    Price the frictions a site-built deal doesn't carry

    Multi-jurisdiction approvals, oversize transport, prevailing-wage exposure in some states, in-transit insurance, and — for steel high-rise — embodied-carbon compliance under new bylaws. None appears in a stick-built pro forma; all belong in yours.

    You should now be able to answerWhich of these five frictions apply to the deal in front of you, and where are they in the sources and uses?

Check yourself

If you can answer these without looking, you have finished the trail. If not, the step number tells you where to go back.

  1. Explain why factory work is treated as unsecured and name two structures that would change it.
  2. State the peak deposit-to-draw gap on a 100-unit project in months and as a share of cost.
  3. Give the borrower's contracted backlog in months of line time, distinct from pipeline.
  4. Place the factory in a tier and name who carries its fixed costs.
  5. Quote one audited output or cost figure from a public filing in the sector.
  6. Name the market figure in the deck and what it counts.
  7. List the modular-specific frictions priced into your underwriting.