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We believe access to capital should be available to ALL businesses.

Click below and explore a variety of options.

BUSINESS LINE OF CREDIT | BUSINESS LOANS

Business Line of Credit

Quick overview

Draw funds when you need them.
Only pay interest on funds you draw.
Avoid prepayment penalties.
No future approvals needed once active.

Every small business owner encounters situations where they need quick access to extra capital. Traditionally, one of the most popular options for handling day-to-day cash flow needs has been a business line of credit.

BUSINESS LINE OF CREDIT FOR SMALL BUSINESSES | BUSINESS LOANS

Business Line of Credit

Quick overview

Draw funds when you need them.
Only pay interest on funds you draw.
Avoid prepayment penalties.
No future approvals needed once active.

Every small business owner encounters situations where they need quick access to extra capital. Traditionally, one of the most popular options for handling day-to-day cash flow needs has been a business line of credit.

What is a Business Line of Credit?

A business line of credit is a revolving loan that gives business owners access to a fixed amount of money, which they can use day-to-day according to their need for cash. LOCs are specifically designed to help businesses finance short-term working capital needs.

How a Line of Credit Works?

When you open a line of credit, you’ll receive access to a stated amount of funds to use as needed. You then receive a monthly invoice reflecting the amount of credit you’ve used, along with any interest charges. Your payment is based on the actual interest accrued on these funds while you use them.

Once the funds are repaid, that amount is available when you need it. You’re only charged interest on the amount of the loan you actually use. LOC rates and limits are set by lenders and based on your risk grade, your collateral, and any servicing requirements.

Your risk grade is judged on factors like the financial success of your business, the state of your business sector in general, your business and personal credit scores, and whether or not you have collateral.

Most lenders will charge an annual fee for the LOC, in addition to interest charges. If you’re going to need a significant number of loan advances and repayments, transaction fees might apply.

Smaller LOCs (under $100,000) can operate as credit card account, with advances made by using a credit card or writing checks issued for the account. Accessing the funds can also be deposited directly in the borrower's account via an ACH deposit.

Is a Business Lines of Credit right for my business?

A business line of credit can help your small business in a time of need, but there are some factors to consider that can potentially negatively impact your business.

Advantages: A small business line of credit can offer near-immediate relief of a cash flow for your small business, solving for a variety of needs, including covering operating expenses through a slow period, helping your business to scale in a time of growth, or investing in new supplies or equipment.

The rates for borrowing a small business line of credit may be lower than charging expenses to a credit card, and the repayment terms can be flexible, allowing your small business to access the small business line of credit funds as you need them.

Disadvantages: Like with any financing, a small business line of credit can post challenges for your business and credit Defaulting on your small business line of credit can negatively impact your business and even personal credit, and make it harder for you to get approved for loans in the future.

Will My Business Qualify for a Line of Credit?

If you have a new business without an established business credit profile or have a low personal credit score, traditional lenders will typically be reluctant to offer you a line of credit.Most lenders prefer to offer a LOC to established companies with a track record and revenues to support the more flexible financing provided by the business line of credit.

A Business Term Loan vs. a Business Line of Credit

A term loan involves a fixed amount of funds loaned out and repaid over a fixed time period. The business owner takes the proceeds from a term loan in one lump sum. A term loan is repaid in a prearranged schedule of payments that1ST COLUMN stay constant until the loan has been repaid.

The funds from a term loan typically go to purchase a specific asset, like a building, a vehicle, or other equipment that is valuable to the business.

A business line of credit is more flexible. With a LOC, businesses are given a credit limit they can borrow against whenever they need it, and they’re free to spend the funds on the costs of their choosing.

Businesses then make regular payments that vary according to the current balance of the credit line, like a personal credit card.

While term loans work well for paying for long-term assets that will be used over many years, LOCs are best for short-term operating purposes and for more immediate revenue-generating activities because the business owner can access funds as he or she needs them.

All you need to qualify

580+ FICO score
6+ months in business
$10k+ Avg monthly revenue
3 most recent business bank statements

Set your business up for financial success.

Apply now

What is a Business Line of Credit?

A business line of credit (or “LOC”) is a revolving loan that gives business owners access to a fixed amount of money, which they can use day-to-day according to their need for cash.LOCs are specifically designed to help businesses finance short-term working capital needs, such as:Purchasing inventory or repairing equipmentFinancing marketing campaignsMaking payroll

How a LOC Works?

When you open a line of credit, you’ll receive access to a stated amount of funds to use as needed. You then receive a monthly invoice reflecting the amount of credit you’ve used, along with any interest charges. Your payment is based on the actual interest accrued on these funds while you use them.

Once the funds are repaid, that amount is available when you need it. You’re only charged interest on the amount of the loan you actually use. LOC rates and limits are set by lenders and based on your risk grade, your collateral, and any servicing requirements.

Your risk grade is judged on factors like the financial success of your business, the state of your business sector in general, your business and personal credit scores, and whether or not you have collateral.

Most lenders will charge an annual fee for the LOC, in addition to interest charges. If you’re going to need a significant number of loan advances and repayments, transaction fees might apply.

Smaller LOCs (under $100,000) can operate as credit card account, with advances made by using a credit card or writing checks issued for the account. Accessing the funds can also be deposited directly in the borrower's account via an ACH deposit.

Is a Business Lines of Credit right for my business?

A business line of credit can help your small business in a time of need, but there are some factors to consider that can potentially negatively impact your business.

Advantages: A small business line of credit can offer near-immediate relief of a cash flow for your small business, solving for a variety of needs, including covering operating expenses through a slow period, helping your business to scale in a time of growth, or investing in new supplies or equipment.

The rates for borrowing a small business line of credit may be lower than charging expenses to a credit card, and the repayment terms can be flexible, allowing your small business to access the small business line of credit funds as you need them.

Disadvantages: Like with any financing, a small business line of credit can post challenges for your business and credit Defaulting on your small business line of credit can negatively impact your business and even personal credit, and make it harder for you to get approved for loans in the future.

Will My Business Qualify for a LOC?

If you have a new business without an established business credit profile or have a low personal credit score, traditional lenders will typically be reluctant to offer you a line of credit.Most lenders prefer to offer a LOC to established companies with a track record and revenues to support the more flexible financing provided by the business line of credit.

A Business Term Loan vs. a Business Line of Credit

A term loan involves a fixed amount of funds loaned out and repaid over a fixed time period. The business owner takes the proceeds from a term loan in one lump sum. A term loan is repaid in a prearranged schedule of payments that1ST COLUMN stay constant until the loan has been repaid.

The funds from a term loan typically go to purchase a specific asset, like a building, a vehicle, or other equipment that is valuable to the business.

A business line of credit is more flexible. With a LOC, businesses are given a credit limit they can borrow against whenever they need it, and they’re free to spend the funds on the costs of their choosing.

Businesses then make regular payments that vary according to the current balance of the credit line, like a personal credit card.

While term loans work well for paying for long-term assets that will be used over many years, LOCs are best for short-term operating purposes and for more immediate revenue-generating activities because the business owner can access funds as he or she needs them.

All you need to qualify

580+ FICO score

6+ months in business

$10k+ Avg monthly revenue

3 most recent business bank statements

Set your business up for financial success.

Apply now

INVOICE FACTORING | BUSINESS LOANS

Invoice Factoring

Quick overview

The business owner sells some or all of the Account Receivable at a discount.
Two types of factoring: recourse and non-recourse factoring.
The factor collects the invoice from the customer.

Go from late to paid with invoice factoring.

Nobody likes waiting for their money, but some business owners are at the mercy of a customer or contract. That's where invoice factoring comes in. We will purchase your invoices so you can get back to running your business with a full bank account.

Invoice Factoring

Quick overview

The business owner sells some or all of the Account Receivable at a discount.
Two types of factoring: recourse and non-recourse factoring.
The factor collects the invoice from the customer.

Go from late to paid with invoice factoring.

Nobody likes waiting for their money, but some business owners are at the mercy of a customer or contract. That's where invoice factoring comes in. Fundible will purchase your invoices so you can get back to running your business with a full bank account.

What is an Invoice Factoring?

Invoice Factoring is technically not a loan and is sometimes referred to as a “lockbox” at banks that offer the service. It’s the preferred method of financing in the textile industry and can be useful for any businesses that don’t have other assets to offer as collateral and need capital quickly.

A “factor” is a third party that purchases part or all of a company’s accounts receivables in exchange for a percentage of the invoice. The “factor” then owns the outstanding invoices and collects them from the customers. The factor earns a profit from the difference between the discounted rate negotiated to buy the account receivables, and the full invoice amount collected from the customer.

How does invoice factoring work?

Invoice factoring isn’t technically a small-business loan. Instead, you’re selling your outstanding invoices to a third party, usually a factoring company, at a discount.In exchange, the factoring company advances you a percentage of your invoice amount, possibly up to 90%. The company assumes responsibility for collecting full repayment on your invoice and once it receives that payment, it sends you the difference, minus the agreed-upon fees.

Smaller LOCs (under $100,000) can operate as credit card account, with advances made by using a credit card or writing checks issued for the account. Accessing the funds can also be deposited directly in the borrower's account via an ACH deposit.

Why is Invoice Factoring Popular Among Business Owners?

Invoice factoring has become popular among business owners, and particularly small and medium-sized brands, because the invoice factoring option enables them to access cash quickly. Invoice factoring, or receivables factoring, allows companies to access capital against receivables owed without having to wait for clients to pay.

In instances when a company, including a smaller brand or one that hasn’t been in business for very long, may be growing quickly and need capital to ensure a smooth process, invoice factoring can be the best solution.

Is invoice Factoring Right for My Business?

Invoice Factoring is a valid option for businesses in many industries. It’s often used in the manufacturing sector because of the traditionally long cycle for producing consumer goods that are distributed through multiple channels before ultimately reaching consumers. It’s also used in many other industries involving business-to-business sales.

Pros of Invoice Factoring

Factoring can be a good option for small businesses looking for quick access to capital without going into debt, giving up equity, or encumbering capital assets.

Factors provide immediate working capital so your company can continue to produce and ship without interruption while giving clients acceptable terms to pay.

Cons of Invoice Factoring

Factoring can be expensive when compared to the cost of traditional lines of credit—though it is less costly than missing sales or letting growth overwhelm the business.
The business owner must be willing to allow the factor to collect the invoice directly from the customer.

How to Qualify for Receivable Factoring Loans?

You will need to complete an application and provide information about your business and finances. Most critically, invoice factoring companies that are considering lending you money will look at your customers.

Since invoice factoring is essentially a cash advance against receivables due, the reliability of your customers to pay their outstanding invoices that you’ve issued will be central to determining whether you might qualify for an invoice factoring loan.

If your customers have a track record, for instance, of not paying their bills or they are at risk of going belly-up, an invoice factoring lender, or factor, might not want to take on that risk by lending you money.

All you need to qualify

580+ FICO score
6+ months in business
$10k+ Avg monthly revenue
3 most recent business bank statements

Set your business up for financial success.

Apply now

What is an Invoice Factoring?

Invoice Factoring is technically not a loan and is sometimes referred to as a “lockbox” at banks that offer the service. It’s the preferred method of financing in the textile industry and can be useful for any businesses that don’t have other assets to offer as collateral and need capital quickly.

A “factor” is a third party that purchases part or all of a company’s accounts receivables in exchange for a percentage of the invoice. The “factor” then owns the outstanding invoices and collects them from the customers. The factor earns a profit from the difference between the discounted rate negotiated to buy the account receivables, and the full invoice amount collected from the customer.

How does invoice factoring work?

Invoice factoring isn’t technically a small-business loan. Instead, you’re selling your outstanding invoices to a third party, usually a factoring company, at a discount.In exchange, the factoring company advances you a percentage of your invoice amount, possibly up to 90%. The company assumes responsibility for collecting full repayment on your invoice and once it receives that payment, it sends you the difference, minus the agreed-upon fees.

Smaller LOCs (under $100,000) can operate as credit card account, with advances made by using a credit card or writing checks issued for the account. Accessing the funds can also be deposited directly in the borrower's account via an ACH deposit.

Why is Invoice Factoring Popular Among Business Owners?

Invoice factoring has become popular among business owners, and particularly small and medium-sized brands, because the invoice factoring option enables them to access cash quickly. Invoice factoring, or receivables factoring, allows companies to access capital against receivables owed without having to wait for clients to pay.

In instances when a company, including a smaller brand or one that hasn’t been in business for very long, may be growing quickly and need capital to ensure a smooth process, invoice factoring can be the best solution.

Is invoice Factoring Right for My Business?

Invoice Factoring is a valid option for businesses in many industries. It’s often used in the manufacturing sector because of the traditionally long cycle for producing consumer goods that are distributed through multiple channels before ultimately reaching consumers. It’s also used in many other industries involving business-to-business sales.

Pros of Invoice Factoring

Factoring can be a good option for small businesses looking for quick access to capital without going into debt, giving up equity, or encumbering capital assets.

Factors provide immediate working capital so your company can continue to produce and ship without interruption while giving clients acceptable terms to pay.

Cons of Invoice Factoring

Factoring can be expensive when compared to the cost of traditional lines of credit—though it is less costly than missing sales or letting growth overwhelm the business.
The business owner must be willing to allow the factor to collect the invoice directly from the customer.

How to Qualify for Receivable Factoring Loans?

You will need to complete an application and provide information about your business and finances. Most critically, invoice factoring companies that are considering lending you money will look at your customers.

Since invoice factoring is essentially a cash advance against receivables due, the reliability of your customers to pay their outstanding invoices that you’ve issued will be central to determining whether you might qualify for an invoice factoring loan.

If your customers have a track record, for instance, of not paying their bills or they are at risk of going belly-up, an invoice factoring lender, or factor, might not want to take on that risk by lending you money.

All you need to qualify

580+ FICO score

6+ months in business

$10k+ Avg monthly revenue

3 most recent business bank statements

Set your business up for financial success.

Apply now

TERM LOANS | BUSINESS LOANS

Term Loans

Quick overview

Re-paid in regular monthly payments over time.
Usually secured by some type of collateral.
Interest rates can be either fixed or variable.
Available from both banks and non-bank lenders.

Term Loans

Quick overview

Re-paid in regular monthly payments over time.
Usually secured by some type of collateral.
Interest rates can be either fixed or variable.
Available from both banks and non-bank lenders.

What is a Term Loan?

Term loans are sources of funding for businesses that, similar to more traditional loans or lines of credit, are paid back over a period of time in monthly installments.

Term business loans, unlike more traditional loans, are more often used to cover large purchases, like equipment, for a business.

If the business owner needs to make a large purchase and doesn’t have the capital to cover it upfront, or else would rather not reduce their cash flow or liquid assets, term loans offer a good alternative. With a term loan, business owners can borrow a lump sum and get the cash upfront, while agreeing to a repayment schedule and terms, which may include a down payment, interest, fees or other conditions.

How Term Loan Payments Works?

Term loan payments combine an amortization of the debt. This means that each loan payment you make covers the accrued interest on the loan, and also a portion of the loan balance. Term loans usually come with fees that are set when you first take out the loan. These fees may be paid upfront or added to the loan balance.

Be sure to ask your lender about this during the application process. Also, term loans usually have late penalties for any payments not made by a specified due date. Payments are made monthly, although a few financial institutions may offer other options, like quarterly payments.

Pros and cons of Term Loans

There are benefits and watchouts with any business venture, including term loans and particularly any that involve lending where variables like repayment terms and interest could cost a business. Specific considerations for business term loans include:

Pros

Ability to borrow funds via term loans quickly to cover immediate needs
Lower interest rates on term loans than credit cards
Opportunity to boost credit care with on-time term loan payments
Cons:
Potential for negative impact to credit if you fail to pay back term loans on time
Approval time for term loans can take longer than other loans
Penalties for late payments on term loans

Term Loan Interest Rates and Fees

Like any loan, with a term loan, you’ll be charged interest on the amount you borrow. How much interest you pay depends on the current rate, and the type of rate structure you negotiate.The interest rate you’ll be offered depends on a variety of factors, including:

The current index rate (lenders usually offer the Prime Rate, LIBOR, or a Treasury Rate, based on the type of loan)
The perceived credit risk represented by your loan
The length of the loan term

Closing Fees on Term Loans

Be prepared to pay certain fees as part of the cost of a business term loan, which could include:

A commitment or loan fee (usually about 1% of the loan amount)
Closing costs, which are determined by the cost of the lender’s lien on the loan collateral, and can range from 1% (for an equipment loan) to 7% (for a real estate loan) of the total amount

All you need to qualify

580+ FICO score
6+ months in business
$10k+ Avg monthly revenue
3 most recent business bank statements

Set your business up for financial success.

Apply now

What is a Term Loan?

Term loans are sources of funding for businesses that, similar to more traditional loans or lines of credit, are paid back over a period of time in monthly installments.

Term business loans, unlike more traditional loans, are more often used to cover large purchases, like equipment, for a business.

If the business owner needs to make a large purchase and doesn’t have the capital to cover it upfront, or else would rather not reduce their cash flow or liquid assets, term loans offer a good alternative. With a term loan, business owners can borrow a lump sum and get the cash upfront, while agreeing to a repayment schedule and terms, which may include a down payment, interest, fees or other conditions.

How Term Loan Payments Works?

Term loan payments combine an amortization of the debt. This means that each loan payment you make covers the accrued interest on the loan, and also a portion of the loan balance. Term loans usually come with fees that are set when you first take out the loan. These fees may be paid upfront or added to the loan balance.

Be sure to ask your lender about this during the application process. Also, term loans usually have late penalties for any payments not made by a specified due date. Payments are made monthly, although a few financial institutions may offer other options, like quarterly payments.

Pros and cons of Term Loans

There are benefits and watchouts with any business venture, including term loans and particularly any that involve lending where variables like repayment terms and interest could cost a business. Specific considerations for business term loans include:

Pros

Ability to borrow funds via term loans quickly to cover immediate needs
Lower interest rates on term loans than credit cards
Opportunity to boost credit care with on-time term loan payments
Cons:
Potential for negative impact to credit if you fail to pay back term loans on time
Approval time for term loans can take longer than other loans
Penalties for late payments on term loans

Term Loan Interest Rates and Fees

Like any loan, with a term loan, you’ll be charged interest on the amount you borrow. How much interest you pay depends on the current rate, and the type of rate structure you negotiate.The interest rate you’ll be offered depends on a variety of factors, including:

The current index rate (lenders usually offer the Prime Rate, LIBOR, or a Treasury Rate, based on the type of loan)
The perceived credit risk represented by your loan
The length of the loan term

Closing Fees on Term Loans

Be prepared to pay certain fees as part of the cost of a business term loan, which could include:

A commitment or loan fee (usually about 1% of the loan amount)
Closing costs, which are determined by the cost of the lender’s lien on the loan collateral, and can range from 1% (for an equipment loan) to 7% (for a real estate loan) of the total amount

All you need to qualify

580+ FICO score

6+ months in business

$10k+ Avg monthly revenue

3 most recent business bank statements

Set your business up for financial success.

Apply now

ASSET-BASED LENDING | BUSINESS LOANS

Asset-Based Lending

Quick overview

Turn your assets into working capital.
Years in business is not a factor.
Challenged credit is not an issue.
More access to capital than a traditional line of credit

Unlocking financial potential beyond the confines of conventional cash-flow lending, Asset-based lending (ABL) empowers businesses to amplify their borrowing capacity by leveraging their owned assets.

Asset-based Lending

Quick overview

Turn your assets into working capital.
Years in business is not a factor.
Challenged credit is not an issue.
More access to capital than a traditional line of credit

Unlocking financial potential beyond the confines of conventional cash-flow lending, Asset-based lending (ABL) empowers businesses to amplify their borrowing capacity by leveraging their owned assets.

What is Asset-Based Lending?

Asset-Based Lending involves securing a business loan against its assets, enabling immediate access to working capital tied up in assets like Accounts Receivable, Equipment, and Inventory. These loans, often structured as revolving credit, offer ongoing borrowing against assets for expenses or investments.

Businesses using Asset-Based Funding seek working capital for operations or growth, especially when their bank credit limit is reached. Typically chosen by companies facing cash flow challenges due to rapid growth, ABL facilities assist in managing growth issues and positioning for future expansion.

How does asset-based lending work?

The evaluation process for ABL financing differs from the familiar cash-flow financing. At our end, we base the loan offer on the available collateral's type and value, alongside your qualifications. To determine your eligible funding, we typically use the loan-to-value ratio (LTV).LTV gets calculated by dividing the loan amount by your collateral's value.

For instance, if your inventory is the collateral, we may offer a loan up to 50% of its value. Generally, more liquid collateral increases your chance of receiving higher funding and lower loan rates. We prefer highly liquid collateral like certificates of deposit or securities as they can be easily converted to cash if there's a loan default. Physical assets, however, are considered riskier.

Asset-based lending example

Let’s say your business is looking for a $100,000 loan to grow your operations. You apply for financing from an asset-based lender and plan to secure your loan with marketable securities (e.g., stocks, bonds, preferred shares).

Your lender agrees to offer a loan equal to 85% of the value of your marketable securities. If your marketable securities have a value of $120,000, the lender can provide a maximum loan amount of $102,000.

Is Asset-based Lending Right for My Business?

Pros of Asset-based Lending

Easier Qualification: Lenders focus predominantly on collateral value, making it possible to secure financing even with fluctuating cash flow or a less-than-perfect credit history, given strong assets.
Competitive Interest Rates: Collateral reduces risk for lenders, often resulting in lower interest rates compared to unsecured loan options.
Flexibility: These loans are versatile, serving various purposes like managing cash flow gaps, covering expenses, and capitalizing on new opportunities without strict fund-use restrictions.

Cons of Asset-based Lending

Limited Asset Eligibility: Some business assets may not qualify as collateral, determined by the lender's criteria.
Added Fees: Besides interest rates, there could be extra costs like origination, audit, and due diligence fees.
Asset Risk: Defaulting on the loan jeopardizes your business assets, which the lender can seize and sell to cover the debt.

All you need to qualify

580+ FICO score
6+ months in business
$10k+ Avg monthly revenue
High liquid collateral preferred

Set your business up for financial success.

Apply now

What is Asset-Based Lending?

Asset-Based Lending involves securing a business loan against its assets, enabling immediate access to working capital tied up in assets like Accounts Receivable, Equipment, and Inventory. These loans, often structured as revolving credit, offer ongoing borrowing against assets for expenses or investments.

Businesses using Asset-Based Funding seek working capital for operations or growth, especially when their bank credit limit is reached. Typically chosen by companies facing cash flow challenges due to rapid growth, ABL facilities assist in managing growth issues and positioning for future expansion.

How does asset-based lending work?

The evaluation process for ABL financing differs from the familiar cash-flow financing. At our end, we base the loan offer on the available collateral's type and value, alongside your qualifications. To determine your eligible funding, we typically use the loan-to-value ratio (LTV).LTV gets calculated by dividing the loan amount by your collateral's value.

For instance, if your inventory is the collateral, we may offer a loan up to 50% of its value. Generally, more liquid collateral increases your chance of receiving higher funding and lower loan rates. We prefer highly liquid collateral like certificates of deposit or securities as they can be easily converted to cash if there's a loan default. Physical assets, however, are considered riskier.

Asset-based lending example

Let’s say your business is looking for a $100,000 loan to grow your operations. You apply for financing from an asset-based lender and plan to secure your loan with marketable securities (e.g., stocks, bonds, preferred shares).

Your lender agrees to offer a loan equal to 85% of the value of your marketable securities. If your marketable securities have a value of $120,000, the lender can provide a maximum loan amount of $102,000.

Is Asset-based Lending Right for My Business?

Pros of Asset-based Lending

Easier Qualification: Lenders focus predominantly on collateral value, making it possible to secure financing even with fluctuating cash flow or a less-than-perfect credit history, given strong assets.
Competitive Interest Rates: Collateral reduces risk for lenders, often resulting in lower interest rates compared to unsecured loan options.
Flexibility: These loans are versatile, serving various purposes like managing cash flow gaps, covering expenses, and capitalizing on new opportunities without strict fund-use restrictions.

Cons of Asset-based Lending

Limited Asset Eligibility: Some business assets may not qualify as collateral, determined by the lender's criteria.
Added Fees: Besides interest rates, there could be extra costs like origination, audit, and due diligence fees.
Asset Risk: Defaulting on the loan jeopardizes your business assets, which the lender can seize and sell to cover the debt.

All you need to qualify

580+ FICO score

6+ months in business

$10k+ Avg monthly revenue

High liquid collateral preferred

Set your business up for financial success.

Apply now

REVENUE-BASED FUNDING | BUSINESS LOANS

Revenue-Based Funding

Quick overview

Short or Long-term availability.
Cover overhead and operational expenses.
Easy and fast secure.
Flexible terms.

Revenue-based financing allows businesses to use their future business revenue to get financing from investors or financing firms. An alternative to debt or equity financing, revenue-based loans can be good for startup businesses or businesses that don’t qualify for financing through traditional means.

Revenue-based Lending

Quick overview

Short or Long-term availability.
Cover overhead and operational expenses.
Easy and fast secure.
Flexible terms.

Revenue-based financing allows businesses to use their future business revenue to get financing from investors or financing firms. An alternative to debt or equity financing, revenue-based loans can be good for startup businesses or businesses that don’t qualify for financing through traditional means.

What is revenue based financing?

Revenue-based financing (RBF) is a type of business funding in which a company secures capital by selling rights to their future projected revenue streams at a discount.

This is a win-win for both parties, as the startup receiving the capital can eliminate the time gap between customer-go-live and the eventual bump to their top-line revenue, and the financer generates a return.

How does revenue based financing work?

Revenue based financing is an agreement between a company and an investor who purchases the company's future projected revenue streams at a discounted rate. The application process typically takes just a few minutes, with funding often being approved within two business days.

Pros and cons of revenue-based financing

Pros

Revenue-based loans are accessible to more types of businesses and business owners. Because revenue-based loans are underwritten to the future revenue of a business, they don't rely on business cash flow, personal assets or personal credit. That typically makes them more accessible for businesses and business owners who don’t qualify for traditional financing.

Flexible with business’s month-to-month revenue. With a revenue-based loan, you pay a percentage of the revenue you generated for that month, which allows the payments to be flexible with your monthly business cash flow.

Business owners don’t have to trade ownership for capital. Unlike equity financing, revenue-based lenders don’t take any shares in exchange for providing capital. This allows a business owner to retain full ownership control of their business.

Cons

Cost Comparisons: They can be costlier than traditional loans. For instance, comparing a $100,000 loan at 6% fixed interest would result in a total repayment of $106,000, whereas revenue-based loans might have a repayment cap like 1.1 times the borrowed amount.

Risk with Expenses: High monthly expenses can pose risks. Revenue-based loan repayments, tethered to monthly revenue, might strain cash flow, making fixed monthly payment loans a more secure option for businesses with substantial monthly expenses.

Revenue Prerequisite: Revenue-based loans necessitate a significant monthly revenue. Lenders often require a minimum monthly revenue threshold.

Alternatives to revenue-based loans

Invoice financing

Depending on your type of business, and especially if you’re not a startup, invoice financing may be a better option. Invoice financing works in a similar way to revenue-based lending, in that you are guaranteeing your loan against future invoices. These types of loans work well with seasonal businesses that have sporadic cash needs and cash flow, though they are mostly limited to B2B businesses since repayment relies on invoices rather than general revenue.

Startup loan

If your need is for startup financing, you may want to look at other startup loan options before choosing a revenue-based loan. If you have strong personal financials and collateral, a startup loan with a bank or online lender may be faster, easier and cheaper.

Business line of credit

If you want flexible repayment options, you may also want to consider a business line of credit. Business lines of credit function like credit cards, in that they are revolving and you only pay interest on the amount of money drawn. As soon as you pay back what you borrowed, you can borrow again. Lines of credit can be solid options for short-term cash flow needs, and for startups in certain situations.

All you need to qualify

580+ FICO score
6+ months in business
$10k+ Avg monthly revenue
High liquid collateral preferred

Set your business up for financial success.

Apply now

What is revenue based financing?

Revenue-based financing (RBF) is a type of business funding in which a company secures capital by selling rights to their future projected revenue streams at a discount.

This is a win-win for both parties, as the startup receiving the capital can eliminate the time gap between customer-go-live and the eventual bump to their top-line revenue, and the financer generates a return.

How does revenue based financing work?

Revenue based financing is an agreement between a company and an investor who purchases the company's future projected revenue streams at a discounted rate. The application process typically takes just a few minutes, with funding often being approved within two business days.

Pros and cons of revenue-based financing

Pros

Revenue-based loans are accessible to more types of businesses and business owners. Because revenue-based loans are underwritten to the future revenue of a business, they don't rely on business cash flow, personal assets or personal credit. That typically makes them more accessible for businesses and business owners who don’t qualify for traditional financing.

Flexible with business’s month-to-month revenue. With a revenue-based loan, you pay a percentage of the revenue you generated for that month, which allows the payments to be flexible with your monthly business cash flow.

Business owners don’t have to trade ownership for capital. Unlike equity financing, revenue-based lenders don’t take any shares in exchange for providing capital. This allows a business owner to retain full ownership control of their business.

Cons

Cost Comparisons: They can be costlier than traditional loans. For instance, comparing a $100,000 loan at 6% fixed interest would result in a total repayment of $106,000, whereas revenue-based loans might have a repayment cap like 1.1 times the borrowed amount.

Risk with Expenses: High monthly expenses can pose risks. Revenue-based loan repayments, tethered to monthly revenue, might strain cash flow, making fixed monthly payment loans a more secure option for businesses with substantial monthly expenses.

Revenue Prerequisite: Revenue-based loans necessitate a significant monthly revenue. Lenders often require a minimum monthly revenue threshold.

Alternatives to revenue-based loans

Invoice financing

Depending on your type of business, and especially if you’re not a startup, invoice financing may be a better option. Invoice financing works in a similar way to revenue-based lending, in that you are guaranteeing your loan against future invoices. These types of loans work well with seasonal businesses that have sporadic cash needs and cash flow, though they are mostly limited to B2B businesses since repayment relies on invoices rather than general revenue.

Startup loan

If your need is for startup financing, you may want to look at other startup loan options before choosing a revenue-based loan. If you have strong personal financials and collateral, a startup loan with a bank or online lender may be faster, easier and cheaper.

Business line of credit

If you want flexible repayment options, you may also want to consider a business line of credit. Business lines of credit function like credit cards, in that they are revolving and you only pay interest on the amount of money drawn. As soon as you pay back what you borrowed, you can borrow again. Lines of credit can be solid options for short-term cash flow needs, and for startups in certain situations.

All you need to qualify

580+ FICO score

6+ months in business

$10k+ Avg monthly revenue

High liquid collateral preferred

Set your business up for financial success.

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Business financing tailored to

your business's needs.

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Business financing tailored to your business's needs.

APPLY NOW