Revenue-Based Financing (RBF) advances capital against your future revenue at a fixed cap, repaid as a percentage of daily or weekly revenue. It sits between a Merchant Cash Advance (MCA, much more expensive) and a bank line of credit (much cheaper but harder to qualify for). The big appeal: no equity dilution, no personal guarantee, no covenants.
How it works
You receive $200,000. The total cap is 1.12, so you'll repay $200K times 1.12 = $224K. The provider takes 6 percent of weekly revenue until that's paid back. At $200K-per-week revenue, $12K-per-week remits, payback hits in about 18 weeks. Effective Annual Percentage Rate (APR): around 24 percent.
Major providers (2026)
- Wayflyer
- Settle
- Clearco
- Parker
- Uncapped
- Shopify Capital (for Shopify merchants)
Typical cost structure
- Cap: 1.06 to 1.20 (6 to 20 percent premium on what you borrowed)
- Daily or weekly remittance: 3 to 10 percent of revenue
- Payback window: 3 to 12 months
- Effective APR: 15 to 35 percent, depending on payback speed
- No personal guarantee, no equity, no covenants
Good vs bad use cases
Good: inventory financing for predictable repeat purchases, ad-spend amplification when your customer lifetime value to acquisition cost ratio (LTV:CAC) is healthy, bridge financing between fundraises.
Bad: covering operating losses (RBF doesn't fix unit economics, it accelerates the bleed). Funding launches with uncertain payback (the daily remittance compounds the cash crunch).
The most common mistake
Stacking RBF across multiple providers. Same death spiral as stacking MCAs. Daily and weekly remittance from multiple providers compounds, drains cash velocity, and eventually breaks the business. Pay off one provider in full before considering another.
Frequently Asked Questions
rbf vs mca, what's the actual difference?
RBF caps total cost much lower (1.06 to 1.20 vs 1.30 to 1.50 for MCA). Effective APR is 15 to 35 percent for RBF vs 50 to 180 percent for MCA. Big gap.
what does rbf actually cost?
Cap 1.06 to 1.20. Effective APR depends on payback speed: a 1.12 cap paid back in 6 months is about 24 percent APR; same cap over 12 months is closer to 12 percent APR.
when should i actually use rbf?
Inventory financing for predictable repeat purchases, ad-spend amplification with healthy LTV:CAC, bridge financing between fundraises. Not for covering operating losses.
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