Revenue-Based Financing
Grow now and repay as a percentage of your revenue, so your payments rise and fall with your cash flow rather than straining a slow month.
Share your revenue history and see your amount, with no obligation to accept.
What is revenue-based financing?
Revenue-based financing from FundBetter gives you a lump sum of capital now and the flexibility to repay it as a fixed percentage of your ongoing revenue, so funding your next move never means committing to a payment your slow months can't carry. When sales are strong you pay a little more, and when they slow down you pay less, so your obligation stays in step with what your business is actually earning.
It sits between a fixed-payment loan and a merchant cash advance. Repayment flexes with your monthly revenue rather than being pulled as a fixed daily or weekly cut of your card sales, which suits growing businesses with recurring or seasonal revenue and supports larger amounts than a card-based advance can reach.
Benefits of revenue-based financing
Payments that flex with revenue
Payments ease off automatically during slow stretches, because you repay a share of what you earn, not a fixed bill.
Built for growth
Access larger amounts as your revenue climbs, so funding keeps pace with your growth.
No fixed collateral required
Qualify on your deposit history instead of pledging an asset, so your equipment and property stay free.
Fast, straightforward funding
A quick application and revenue-based approval move capital into your business fast, without the paperwork and waiting of a bank.
How does revenue-based financing work?
Getting funded is quick and light on paperwork. You apply and share recent revenue and bank statements, and that's the heavy lifting done. FundBetter reviews your sales history and comes back fast with an amount and the percentage of revenue that will go toward repayment.
Accept the offer and funds land in your account. From there repayment runs itself, flowing automatically as a set share of your revenue until the agreed total is repaid, with nothing to schedule.
How your revenue-based financing percentage is set
The percentage is the one number that shapes every payment you make, and understanding it puts you in control of the deal. It's priced during underwriting from your own numbers, not pulled off a rate card. Underwriters read several months of bank statements and weigh three things above all: how much revenue arrives each month, how steady that revenue is from month to month, and how much of it's already committed to rent, payroll, suppliers and any existing financing. A business at $40,000 a month with deposits that barely move is treated differently from a business at $40,000 a month that swings between $12,000 and $90,000, even though the annual totals match.
Stability is what pulls the percentage down, and it's the lever most within your control. Recurring contracts, subscription billing, repeat orders at a wholesale distributor and long-tenured customer accounts all signal that next month will look like last month, and predictable revenue supports a lower share. Volatility pushes the percentage up, because the funder has to assume the slow months will be slower than average. Time in business works the same way. Six months of history is enough to qualify, but a business with three years of statements gives underwriters far more to price against, and the offer usually reflects that.
The percentage and the amount you draw move together, and this is where you make the real decision. Asking for more against the same revenue sends a larger share of each deposit to repayment, which shortens the effective term but tightens month-to-month cash flow. Asking for less leaves more working capital in the business each week. Take your slowest month in the past year, apply the proposed percentage to it, and confirm that the business still covers payroll and suppliers on what's left. If a slow month is uncomfortable at that percentage, take a smaller amount rather than betting on a strong quarter.
Because the share applies to gross revenue, thin-margin businesses feel a given percentage far harder than wide-margin ones. A 6 percent share of revenue is a modest deduction on a consulting firm and a serious one on a distributor running low single-digit margins. Underwriters account for this, and so should you when you compare offers.
Revenue-based financing vs. a merchant cash advance
These two products are close relatives, and seeing them side by side makes the cheaper fit obvious. What separates them is where repayment comes from and which businesses each one suits.
| Revenue-based financing | Merchant cash advance | |
|---|---|---|
| Repayment drawn from | Total business revenue, including invoices, transfers, ACH and card sales | Card sales only, deducted as a share of daily credit and debit card batches |
| Typical amount | $5,000 to $5 million, sized to monthly revenue and its consistency | Generally smaller, sized to average monthly card volume |
| Speed to funding | Often one to two business days after a revenue review | Sometimes same day, on a lighter document set |
| Best suited to | Growing businesses with mixed or non-card revenue, such as ecommerce brands, that want a larger, growth-sized amount | Retail, restaurants and other businesses where nearly all revenue arrives by card |
What revenue-based financing costs
Cost here's not quoted as an interest rate, because there's no fixed schedule to amortize. It's quoted as one clear total upfront, and reading that total correctly is how you avoid surprises and overpaying.
The repayment total
You agree upfront to a fixed dollar amount you'll repay, expressed as a multiple of what you receive, so there are no surprises later. Draw $100,000 at a 1.3 multiple and you repay $130,000, no more and no less, regardless of how long it takes. Compare offers on this total, not on the percentage, because a low percentage attached to a high multiple is the more expensive deal.
How the term flexes
There's no set end date, and that works in your favor when sales dip. The term is whatever it takes for the agreed percentage of your revenue to add up to the repayment total. Beat your projections and you clear the balance early. Fall short and repayment stretches out, with smaller payments along the way. That same flexibility is what makes the effective annualized cost hard to pin down in advance.
Paying off early
Because the total is fixed rather than accrued, finishing early doesn't usually lower what you owe, and that's worth planning around. Repaying $130,000 in eight months instead of eighteen costs the same dollars but a much higher effective rate. Some agreements include a discount for early payoff, so ask directly whether yours does before you accept, and get the answer in the agreement rather than in conversation.
The cost tradeoff
Priced against a term loan or an SBA loan, revenue-based financing generally costs more, and it's fair to ask what that buys you. You're paying for speed, for approval based on revenue rather than collateral, and for payments that fall on their own when sales fall. If your revenue is predictable and you can wait for a slower process, a fixed-payment product will almost always be cheaper.
Is revenue-based financing right for your business?
Revenue-based financing fits a specific shape of business, and FundBetter would rather steer you toward a better-matched option than push a poor fit. Here's where it works, and where it doesn't.
Revenue-based financing works well when
- Your revenue is seasonal or uneven, as it is for most agriculture businesses, and a fixed monthly payment would strain your slowest months
- Most of your sales arrive by invoice, ACH or transfer rather than card, as they do for technology companies, which rules out a card-based advance
- You are funding something that should lift revenue directly, such as inventory, marketing or a hire ahead of demand
- You have limited hard assets to pledge but a clear, documented sales record
Revenue-based financing is a poor fit when
- Your margins are thin enough that a share of gross revenue would consume most of your profit on each sale
- You are buying a long-lived asset such as property or heavy equipment, where equipment financing and its longer, cheaper term fit far better
- Revenue is still building and your statements do not yet show six months of steady deposits, though invoice factoring can work off the invoices you have already issued
- You need an exact payoff date for planning purposes, which a revenue-linked term cannot give you
- You are covering an ongoing shortfall rather than funding growth, since repayment scales with revenue but not with profit
- A bank or SBA loan is genuinely available to you and the timeline is not urgent
Best ways to use revenue-based financing
Revenue-based capital is built for spending that compounds.
Who qualifies for revenue-based financing?
Consistency matters more than size here.
Check if you qualifyFrequently Asked Questions
How is revenue-based financing different from a merchant cash advance?
Both flex with sales, but the source differs. A merchant cash advance takes a share of your credit and debit card batches, so it only fits businesses that run nearly all revenue through a card terminal. Revenue-based financing draws from total revenue, including invoices, ACH and transfers. That wider base generally supports larger amounts and suits businesses that don't sell primarily at a counter.
What percentage of revenue will I have to repay?
The percentage is set in underwriting, not published in advance. It depends on how much revenue you bring in, how consistent it's across months, how long you have been in business, and how much you draw. Steady, recurring revenue supports a lower share. Volatile revenue or a larger amount against the same sales pushes it higher. One of our funding advisors will give you the exact figure before you accept anything.
What happens to my payments if sales drop?
The dollar amount falls automatically, because the percentage stays fixed while the revenue it applies to shrinks. A slow month produces a smaller payment without a call, a request or a missed obligation. The total you owe doesn't change, so repayment simply takes longer. This is the core reason seasonal businesses choose revenue-based financing over a fixed monthly payment.
How long does revenue-based financing take to repay?
There's no fixed end date. Repayment finishes when the agreed percentage of your revenue adds up to the total you agreed to repay. Strong sales shorten it, slow sales stretch it. Our team can model an expected window from your current revenue, but treat it as a projection rather than a maturity date.
Can I get revenue-based financing with bad credit?
Often yes. Approval leans on your revenue history rather than your personal credit score, so businesses that a bank would decline on credit alone are frequently approved here. Six months in business and $15,000 or more in monthly revenue matter far more than the score itself. Weaker credit may still influence the percentage and the amount you're offered.
Does taking revenue-based financing give up equity in my business?
No. You repay a share of revenue for a defined period, not a share of ownership. Once the agreed total is repaid, the arrangement ends and no further claim on your revenue or your company remains. There's no board seat and no dilution, which is what separates it from raising money from an investor.
Other business funding options
Merchant Cash Advance
Faster and easier to qualify for, drawn from card sales only.
Learn moreBusiness Lines of Credit
Draw only what you need instead of taking the full amount upfront.
Learn moreLong-Term Business Loans
Fixed payments and lower cost if your revenue is steady and predictable.
Learn moreFuel growth with revenue-based financing
Share your revenue history and see what you qualify for. Free, with no impact to your credit.