Revenue Based Financing Growth Capital

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What is Revenue Based Financing? (RBF)

Revenue Based Financing (RBF) is an innovative new source of growth capital.  As a result, emerging companies can expand their business and increase the value of their company.   With RBF, you don't sacrificing equity, or take on cumbersome debt.  Above all, cash flow friendly flexible monthly payments rise and fall with revenue.

Unlike traditional debt, there are no restrictive covenants, hard collateral or personal guarantees.  Additionally, no equity position is taken. Therefore you retain ownership and control of your company.  The CEO' Guide to Types of Growth Capital

 

How Does Revenue Based Financing Work?business friendly funding

  • Growth capital is provided up-front in exchange for a percentage of a company’s monthly top-line revenue
  • Revenue base financing loans range from $1M to $3.5M
  • The revenue based rate is typically fixed at 1-5% of the top-line revenue
  • Flexible monthly payments rise and fall with revenue
  • Revenue based financing payments are structured to last for about 4 to 6 years
  • Flexible payments continue until the capital plus a predetermined amount is repaid.

 

Benefits of Revenue Based Financing:

  • Retain 100% ownership and control
  • Structured to be cash flow friendly
  • No restrictive financial covenants
  • No personal guarantees
  • Business friendly funding
  • No collateral
  • No default provisions

How Much Growth Capital Can We Get?

  • Typically between $1M and $3.5M

What are the Qualifying Criteria?

  • Approximately $3M - $50M annual revenue
  • Market-proven product or service
  • In business for 3 plus years
  • Substantial growth opportunities - expand sales presence, acquisition, new product launch, etc.
  • Gross margin in excess of 30%
  • Sales forecast with detailed sales process and plan in place
  • Proven management team that values their equity

    Revenue Based Financing - Smart Growth Capital

     

Keep 100% of Your Equity
No Restrictive Financial Covenants
Off Balance Sheet
Retain Management Control
Flexible Monthly Payments
Fits with Pre-Existing Debt
No Exit Strategy Required
No Personal Guarantees
No Hard Collateral
No Pre-Money Valuation
Focus is Revenue Growth
Payment is Fixed % of Revenue