Revenue-based financing cost
Enter an advance, a cap, and a revenue share. See the months to repay and the effective annual cost.
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What revenue-based financing really costs
A lender gives you cash today. You pay back a part of each month's revenue until the payments reach a cap.
Total to repay, as a multiple of the advance.
- Total to repay
- $700K
- $500K × 1.4
- Months to repay
- 30
- First payment $24K
- Effective annual cost
- 32.7%
- The yearly rate of the payments
Effective annual cost at each growth rate
You pay 6% of revenue, $24K in the first month. You repay $700K in 30 months, $200K more than the advance. That cost is like 32.7% a year.
Move the growth up and watch the yearly cost rise: the same total comes back sooner. Many founders expect the opposite.