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Revenue -Based Financing

Get the Capital your business needs in less
than 24 hours.

Business Owner

Revenue -Based Financing Overview

Annual Revenue 

$120K

Time in Business

At least 6 months

Minimum Credit Score

600+

What is Revenue -Based Financing?

A revenue-based loan is a type of financing designed to help businesses manage short-term operational needs by offering repayment terms that align with the company's revenue. Unlike traditional loans, revenue-based lending ties repayments directly to the business's income, meaning the loan is repaid as a percentage of monthly revenue, rather than fixed installments. This allows businesses to manage cash flow more effectively, especially during periods of fluctuating income.

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Revenue-based loans are particularly beneficial for growing businesses, providing them with flexible capital without the burden of a long-term fixed repayment schedule. These funds can be used to manage inventory, cover payroll, or seize sudden business opportunities. The repayment structure, based on revenue, makes this type of financing ideal for companies with seasonal sales or variable income, as it adjusts to their financial performance, helping them scale efficiently while maintaining operational stability.

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How to Apply?

Plenty of businesses can qualify for a traditional term loan—as long as you’ve been in business for a minimum required period of time, have a good credit score, and are currently generating revenue.

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Not all business term loans are the same, though: the interest rate, loan term length, and maximum loan size depends on your business revenues and business credit rating.

How to Apply for a Revenue-Based Financing

STEP 1

Get Pre-qualified

To get pre-qualified for a working capital loan, click the "Apply Now" button and enter general information about your business.

STEP 2

Await Approval

Once processed, one of our Business Consultants will contact you to discuss the available options for which you qualify.

STEP 3

Receive Funding within 24 hours

Once approved and the offer is accepted, the funds will be directly deposited into your bank account, allowing you immediate access to capital

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Discover Your Revenue-Based Financing Options 

Find Out What Your Small Business Qualifies for Today

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Documentation and Qualifications for Revenue -Based Financing

Documentation Needed:

  • Application

  • 3 Months of Business Bank Statements

  • Business Profit & Loss Statements*

  • Business Balance Sheet*

* If needed

Qualifications:

  • $120,000 in annual revenue

  • 6+ months in business

  • Minimum 600 credit score

Securing revenue-based financing is a streamlined process with minimal documentation and qualification requirements. Applicants typically need to submit a basic application along with three months of business bank statements to demonstrate recent financial performance. In some cases, additional documents such as profit and loss statements or a balance sheet may be requested during the underwriting process for further review.

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To qualify, businesses generally need to have at least $120,000 in annual revenue and a minimum of six months in operation. A credit score of 600 or higher is often required, ensuring that the business has a stable financial foundation. These criteria are designed to make revenue-based financing accessible while maintaining responsible lending standards. The flexibility of repayment tied to revenue makes this type of financing an attractive option for businesses seeking growth capital.

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Revenue -Based Financing: Pro Vs Cons

Revenue -Based Financing Advantages

Revenue-based financing offers essential funds to cover daily operational expenses, helping businesses maintain smooth operations during periods of fluctuating or inconsistent income.

Revenue-based financing is processed quickly, enabling businesses to promptly address their financial needs.

Business owners retain full ownership of their company, unlike equity financing, which requires giving up a portion of ownership.

The capital from revenue-based financing can be utilized for a range of urgent financial needs, such as payroll, rent, utilities, or restocking inventory.

Revenue -Based Financing Disadvantages

Revenue-Based Financing may carry higher interest rates, particularly for businesses or owners with less-than-ideal credit profiles, reflecting a higher cost of capital.

The repayment terms for this financing are typically shorter, designed to quickly free businesses from debt

Revenue-based financing may involve certain fees, but these are clearly disclosed upfront, allowing businesses to plan their finances effectively and avoid unexpected costs.

Alternative revenue -based financing options

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Revolving Line of
Credit

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Equipment
Financing

Modernize and expand with dedicated equipment financing solutions.

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SBA 
Loans

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Best Practices for Managing a Revenue -Based Financing

Effective Strategies for utilizing a revenue-based financing

Prioritize High-ROI Projects:

Focus on using the funds for projects or areas that offer strong potential for high returns. This could include expanding product lines, ramping up marketing efforts, or investing in cost-saving technologies to enhance operational efficiency. By allocating capital strategically, businesses can drive growth while benefiting from the flexible repayment structure tied to revenue, ensuring that payments align with performance.

Improve Inventory Management:

Otimize inventory management by preventing both overstocking and understocking, which can otherwise tie up valuable capital. By streamlining your inventory processes, you ensure that resources are used efficiently, allowing your business to operate more smoothly. This approach not only frees up cash flow but also enhances overall operational efficiency, helping your small business thrive.

Optimize Accounts Receivable:

Invest in upgrading your invoicing and collections processes to accelerate cash inflows from customers. By reducing the cash conversion cycle, you improve liquidity, ensuring your business has the necessary cash flow for daily operations. This enhanced cash management allows your small business to maintain financial stability and operate more efficiently.

Regular Monitoring and Forecasting:

Keep a close watch on cash flow forecasts and actual cash flow. Regular monitoring helps in making informed decisions about deploying and replenishing financing, essential for maintaining financial health in your business.

Leverage for Negotiation:

Use the financial leeway provided by the loan to negotiate better terms with suppliers, clients, or potential business partners.

Common Missteps when utilizing revenue-based financing

Avoid Overleveraging:

Be cautious not to take on more debt than the business can handle, even if a lender offers more than what is needed. Overborrowing can lead to financial stress and difficulty in repayment, particularly for small businesses and startups.

Don’t Misuse Funds:

Strictly use the loan for intended short-term operational needs rather than for long-term investments or non-essential expenditures. This discipline is crucial for maintaining the primary goal of business sustainability and growth.

Maintain a Debt Service Coverage Ratio (DSCR):

Always keep an eye on your DSCR, which measures your company’s ability to service its debt with its current revenue. A healthy ratio ensures you can comfortably make loan payments, vital for business lending stability.

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