What is Revenue Based Funding

What is Revenue Based Funding?

Primarily for ecommerce businesses, ‘revenue based funding’ is a form of finance that provides repayment flexibility. It’s a great short-term working capital solution to help businesses grow, manage cash-flow and buy stock.

Repayment flexibility:

One of the main differences with RBF over a standard term loan is how you repay the finance.
Repayment is taken as a percentage of a business’ sales instead of fixed monthly amounts.
This helps manage cash flow. When a business has a slower period they repay less and when there is a busy period they repay more. Helpful for businesses trying to grow or are seasonal.


Access to revenue based funding can be extremely fast – you’re talking 48hrs from full application to funds in the account.
What makes it fast is the use of digital applications, analytics and open banking. Rather than having to gather or download loads of bank statements and filling in lengthy forms. That means busy business owners can focus on running the business.

It also means businesses can pounce on growth opportunities knowing they could have the funding in a few days. Think Valentine’s Day, Spring Bank Holiday, and Black Friday: all great opportunities to dial up the marketing spend and ensure they have the stock to fulfil order.

Fixed fee:

It’s a single flat fee agreed on upfront, so a business knows the exact total repayment, with no lender set-up or admin fees on top.


No equity in the business is taken or any charges secured on the business. Even a personal guarantee isn’t always required unlike most other forms of business lending.

Top-ups and recurring funding available:

Revenue based finance is shorter term and typically repaid within 12 months or sooner, depending on the business revenue performance. However, many businesses use it as a recurring form of working capital and top-up as and when needed.
Working capital, by definition, needs to be constantly replenished. Revenue based funding doesn’t need to be a one-off deal, but a longer-term relationship, supporting recurring costs like ad spend and paying suppliers. Revenue-based financing grows with your business. If a new product line a business has been testing takes off quicker than expected and needs another cash boost to grow even further, that can be arranged seamlessly at the speed of the business’ growth.

Case Study:

An online bedding company:

After taking an initial advance with a revenue based lender, they needed the right team and technical structure to scale without sacrificing their strong customer economics.

The business used revenue-based financing to launch two new channels, leading to a 43% increase in new customers, while the cost per acquisition stayed under target. They also achieved a 33% increase in monthly Gross Sales, and the business made over 2x year-on-year sales. 

Find Out More

If you’re predominately an e-commerce business then this is a great funding option – get in touch to find out more!

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We will do the heavy lifting for you and what’s more:

  • We’ll manage your application
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  • You will not pay more than going direct