Can you tell me a little bit about Business Revenue Funding?
Sure! Business Revenue Funding, also known as Royalty-Based Funding or RBF, is a form of business funding that allows investors to give you money in exchange for a small percentage of your ongoing revenues.
How much funding can I get from Finance Fitness GYM through this option?
Our lenders currently offer funding ranging from $50,000 to approximately $25 million. We do hold a maximum of 1/3 of your current annual revenue run-rate. So, if you want $1 million, your business currently has to generate about $3 million in revenue per annum.
What do I owe in return?
We will want a small percentage of your revenue until the total repayment cap has been reached. The amount we ask for ranged from 1% to 9%, and it’s calculated and debited from your ACH monthly.
So, what’s the interest rate?
Business Revenue Funding doesn’t actually have a real interest rate. If your revenues slump, you pay a smaller share. If your revenues skyrocket, you pay more.
Why would I choose Business Revenue Funding?
It allows you to keep control of your company, and also has much more flexible payment terms than the typical loans you would get from a bank. If you don’t make much money in one month, that’s okay. You will end up paying less that month. Another common perk is that you don’t need a business credit score to get this kind of funding.
Wait, do I have to keep paying part of my revenues forever?
Nope! Once you have reached the payment cap, all payments cease.
Do you offer funding for pre-revenue startups?
Yes! Our investors are always interested in seeing the newest, most innovative startups that are ready to explode onto the scene.
What kind of industries do best with this form of funding?
Technology, information, and software companies tend to fare well with Business Revenue Funding. Other industries, especially those with more solid assets, tend to find it easier to get funding through more traditional means. That being said, we won’t turn away non-tech industries from this form of funding.
Can I pay early?
Can I qualify if banks have already rejected me?
Yes. Actually, this form of funding was designed for companies experiencing this situation.
Can I qualify if I have bad credit, a tax lien, or a bankruptcy on my record?
I already have a loan with another company. Can I still qualify?
In certain situations, yes. As long as you’re in good standing, you should be good to go.
Why shouldn’t I go to Venture Capitalists or banks instead?
Simply put, you can in theory. However, in practice you will find that both VCs and banks tend to have absurdly high standards. They may require high amounts of collateral, or take a huge chunk of ownership in your company. Their payment terms may not be as flexible, and getting rejected is the norm. It’s not a route that many businesses should take, even though they technically can.
How long do these payment schedules last?
Usually, we like to see businesses finish paying off their Business Revenue Funding within a maximum of 5 years. We tailor it to your company’s needs, so each company will be a bit different.
Is Royalty-Based Funding the same thing as “receivables financing” or “factoring?”
Absolutely not! Those kinds of funding programs work with the revenues that you have already gotten, or are about to receive. This form of funding is more flexible, has longer terms, and also can get you much more money for your long term needs.
Do I need an attorney’s assistance?
It’s never harmful to speak with an attorney regarding personal and business matters, and often times, it may be the best thing you can do if you think that an attorney’s advice can help you. Although we aren’t a law firm and we cannot provide anyone with any legal advice, you are more than welcome to speak with an attorney that we use for our company. We truly want to get familiar with our clients, and help them in any way we can. Simply send an email to email@example.com and we’ll be sure to forward it.
Still need help? If you have a question that isn’t answered here, or if you feel like you could use advice when it comes to the best route of financing for your business, we are here to help you make the best choice for your company! You may call us at 833-FINANCE or email: firstname.lastname@example.org. You’re also more than welcome to visit our office. Evening and weekend appointments are available.