Revenue-Based Financing

Partner with Expansion Capital Group on revenue-based financing for your continued business success.

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What is Revenue-Based Financing and How Does it Work?

Revenue-based financing* (RBF) is a funding model where a business sells a specified percentage of its future receivables for an funder's principal. It is a form of alternative financing that offers a flexible and performance-based approach. Unlike traditional funding with fixed monthly payments, revenue-based financing ties the repayments to the business’s ongoing revenue streams.

Revenue-based financing is often attractive to businesses with uneven revenue streams that may not have the assets or credit history to secure traditional loans or funding. It provides a more flexible and collaborative approach to financing, aligning the interests of the business and the purchaser.

*Not available in all states.

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Flexible

Weekly/daily remittances

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Scalable

Offers from $5k-$300k

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Dependable

Over 20,000 small businesses funded

What are the Advantages?

  • Repayment Structure | The business agrees to remit a percentage of its monthly revenues to the funder.
  • No Maturity Date | The purchase and sale transaction continues until the amount of the obligation undertaken is satisfied.
  • Equity-Free Financing | A form of financing that does not require a pledge or sale of business equity.
  • Risk for Funders | Funders take on more risk than traditional lenders because the return is directly linked to revenue performance.

Minimum Requirements

Revenue-based financing can be highly beneficial for business owners seeking flexibility and performance-based funding.

  • 6+ Months in business
  • Fair/Good credit score
  • $100k annual revenue
  • U.S.-based business locations

FAQs

How Small Businesses Have Used Revenue-Based Financing

Small businesses have increasingly turned to revenue-based financing as a flexible and accessible funding solution. Unlike traditional loans, revenue-based financing arrangements allow businesses to secure capital without sacrificing equity or facing stringent credit requirements. Instead, financing is provided based on the company’s future revenue streams, with repayments tied directly to ongoing streams. This model aligns the interests of the business and the financier, as repayments fluctuate with revenue performance, providing breathing room during slower periods and scaling up with growth.

Small businesses have utilized revenue-based financing to fund various initiatives, including expansion projects, marketing campaigns, inventory purchases, and hiring efforts, enabling them to capitalize on opportunities for growth while maintaining financial flexibility. With its adaptable structure and focus on revenue generation, revenue-based financing has emerged as a valuable tool for small businesses seeking to navigate the challenges of scaling operations and achieving sustainable growth.

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