Revenue-Based Financing Calculator

Revenue-based financing is economically similar to a loan in that it is a form of debt: the company receives money and must repay more than it received. However, RBF is structured differently: there are no fixed monthly payments, no interest rate in the traditional sense, and no hard maturity date. Instead, repayment is tied to a percentage of revenue, making payments naturally variable. The total repayment is capped at the advance times the capital factor, so if revenue is lower than expected, the repayment period extends — there is no default from slow repayment alone. Legally, most RBF agreements are structured as revenue purchase agreements (buying future receivables) rather than loans, which can affect regulatory treatment and bankruptcy priority.

RBF lenders typically require: minimum MRR of $15,000-$50,000 depending on the provider; at least 6-12 months of operating history; subscription or recurring revenue model (though some providers fund e-commerce); low customer churn (below 5-10% monthly for SaaS); and no existing senior debt that conflicts with the RBF lien on revenue. Leading RBF providers for SaaS include Lighter Capital (minimum $15K MRR), Clearco (e-commerce and SaaS), Capchase (SaaS, minimum $15K MRR), and Arc (SaaS). Pipe and similar platforms allow companies to trade future contracted revenue for upfront capital. Most RBF providers do not require personal guarantees or physical collateral — the underwriting is based entirely on revenue quality and growth.

The capital factor (also called the cost cap or repayment cap) is the multiplier applied to the advance amount to determine total repayment. A 1.10x capital factor means you repay $110,000 for every $100,000 advanced — a flat $10,000 fee regardless of repayment timing. This differs from an interest rate, which accrues over time: a 10% interest rate costs $10,000 in year 1 but only $5,000 if repaid in 6 months. RBF's flat fee structure means the effective annualized cost (APR equivalent) is higher for fast repayers (high-growth companies) and lower for slow repayers. When comparing RBF to other financing options, convert the capital factor to an effective APR using the expected repayment timeline: APR = (Total Repayment / Advance)^(12/Repayment Months) - 1.

RBF advance sizes are typically calculated as a multiple of the company's monthly recurring revenue: 3-6x MRR for SaaS companies, 30-50% of trailing 12-month revenue for e-commerce. For a SaaS company with $200,000 MRR, RBF advances typically range from $600,000 to $1,200,000. Some providers (Clearco, Pipe) offer larger advances at higher revenue levels. The advance size is limited by the lender's assessment of repayment capacity — they want to ensure the revenue share percentage produces timely repayment without straining the company's cash flow. Maximum advances rarely exceed $5M-$10M for non-bank RBF providers, though bank-affiliated RBF programs (SVB's venture lending) can go larger.

The primary risk of RBF is the ongoing revenue commitment: regardless of profitability or business challenges, the revenue share payment is due every month that the company has revenue. This can strain cash flow during a difficult period — if revenue drops 30%, the RBF payment also drops 30%, but the company is still obligated to continue until full repayment. Unlike equity investors who share the downside, RBF providers are creditors who must be repaid. Companies that take RBF and then face revenue headwinds can find themselves in a spiral: slower revenue growth extends the repayment period, during which they cannot take additional RBF (most providers don't stack facilities), limiting their ability to invest in growth that would accelerate repayment.

Yes, RBF and venture equity are complementary financing tools that many startups combine. A typical pattern: raise a seed equity round to get to product-market fit, then use RBF to fund growth (marketing, sales headcount) non-dilutively while preparing for Series A, then raise Series A equity for the next phase. This approach allows founders to demonstrate stronger metrics (higher MRR, lower churn) at Series A by using RBF to fund growth between rounds — resulting in a higher Series A valuation and less dilution. Some Series A investors actively encourage portfolio companies to use RBF for working capital needs, reserving equity capital for strategic hiring and product development.

Accounts receivable (AR) factoring involves selling outstanding invoices to a third party at a discount to receive cash immediately, rather than waiting for customers to pay. It is primarily used by B2B businesses with long payment terms. RBF is different: it provides an upfront advance based on projected future revenue, repaid through a percentage of ongoing revenue. AR factoring is transaction-based (each invoice is a separate sale), while RBF is a portfolio arrangement covering a period of revenue. Both are non-dilutive, but AR factoring is better for businesses with large outstanding invoices and long payment cycles, while RBF is better for subscription businesses with predictable future revenue streams.