The Business Credit and Financing Guide
VI. Cash flow-Based Financing: Fast, Easy Money From Wikipedia: “Revenue based financing or royalty based financing (RBF) is a type of financial capital provided to small or growing businesses in which investors inject capital into a business in return for a percentage of ongoing gross revenues. Usually the returns to the investor continue until the initial capital amount, plus a multiple (also known as a cap) is repaid.” Revenue-based financing is often described as between two concepts. A bank loan, which often requires collateral or significant assets. And angel investment or venture capital, which involves selling equity in a business in exchange for an investment. In an RBF investment, investors do not take an upfront ownership stake in the business. Rather, you are selling your future revenue for a fee (a discount). Revenue-based financing goes by many names: ●● RBF ●● Revenue-based funding ●● Revenue-based loans ●● Revenue financing ●● Cash flow financing ●● Cash flow-based financing ●● Cash flow loans ●● Bank statements loans ●● ACH financing ●● Royalties-based financing
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