Whether in the always-thriving technology community, the SaaS sector, or a variety of other industries, revenue-based funding (RBF) has become increasingly popular in recent years.
For those still unacquainted with RBF, it’s critical to answer a few important questions. For instance, how does revenue-based funding work? And what are the economic shifts driving the popularity behind this modern-day financial lending model?
How Does Revenue-Based Funding Work?
The general idea behind revenue-based funding is quite simple: the future success of your company can stimulate today’s growth. It’s a versatile funding model that sees companies provide capital to small corporations by purchasing future receivables.
The benefits of RBF can be substantial. The corporation receiving the funding keeps full control of its business; funding occurs much quicker than it would with a traditional bank loan; and repayment ends immediately once the agreed-upon cap is reached. Essentially, it’s a win-win for both parties.
A Trending Market
In this current era of prized ownership, small businesses are seeking ways to retain full control of their operations. And if the future outlook of one’s business is bright, why give away partial ownership today for pennies on the dollar?
That’s exactly where revenue-based funding comes in. This funding model allows small business owners to stimulate growth without selling off a substantial portion of their dream—and it does so far more quickly. Additionally, RBF models offer flexibility, as payments provide these small businesses with more breathing room.
Current Sentiment
The satisfaction in those granted revenue-based funding is obvious. One need only look as far as Everest Business Funding’s real-life funding recipients as examples.
Take Joshua Corman, for example, the owner of the Dallas-Fort Worth-located Cypress Safety Professionals. Funds granted from Everest Business Funding allowed Corman and his business to respond quickly to urgent calls and assist those in the local community.
Kiki Ely, founder of Atlanta-based Kiki Kastings Entertainment, also recognizes the value in revenue-based funding. Everest Business Funding stepped in and allowed Kiki the financial support to set up her studio, expand her services, and guide aspiring artists toward their dream careers.
The Economic Shift Driving Non-Dilutive Funding
So, what economic shifts have driven the excitement in revenue-based funding? Everest Business Funding points to the fact that in an era of economic uncertainty, more and more company founders prefer to rely on themselves. With minimally- or non-dilutive funding, entrepreneurs are able to grow their businesses without selling a massive equity stake to investors.
Moreover, Everest Business Funding indicates that revenue-based funding can help boost a company’s valuation by improving financial performance in both the short and long term, by allowing a company to fund key growth initiatives, ultimately securing consistent revenue. That’s a massive plus to company founders looking to establish a name for themselves.
About Everest Business Funding
Everest Business Funding provides alternative finance options and revenue-based funding to small business owners. They serve a diverse pool of businesses, from healthcare to retail, to help them obtain working capital to grow, buy inventory, launch marketing campaigns, or hire staff. Everest Business Funding’s clients are treated with respect and receive high-quality guidance and service from its professionals.
The post Everest Business Funding on the Future of Growth Capital: Why Revenue-Based Funding is on the Rise appeared first on The Village Voice.