Revenue-Based Financing for Hospitality Businesses
July revenue: $165,000 at 88% occupancy. January: $38,000 at 22% occupancy. Revenue-based financing ties payments to your actual deposits, creating automatic seasonal adjustment. Pay more when the property is full, less when it is quiet.
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How Revenue-Based Financing Works for Hotels
Revenue-based financing ties repayment to your total bank deposits. Since deposits reflect occupancy and guest spending, payments naturally align with your seasonal patterns.
Deposit-Based Mechanics
A 7% revenue share means 7 cents of every dollar deposited goes toward repayment. A $120,000 deposit month means $8,400 in payments. A $35,000 deposit month means $2,450. Automatic seasonal adjustment.
Perfect for Seasonality
Hospitality has some of the most dramatic seasonal swings. Revenue-based financing handles this automatically. No need to negotiate seasonal payment schedules, it just happens.
All Revenue Counts
Room revenue, restaurant and bar, events, and ancillary services all deposit to your account and contribute to repayment. Complete property performance drives payments.
Occupancy Correlation
Revenue correlates directly with occupancy and rate. High occupancy drives high revenue and higher payments when you can afford them. Low occupancy means lower payments when you need relief.
Why Fixed Payments Hurt Hospitality
Hospitality revenue is inherently variable. Financing should acknowledge occupancy-driven cash flow reality.
Dramatic Seasonal Swings
Peak season might generate 4-5x slow season revenue. Fixed payments calculated for average month stress both extremes.
Occupancy-Driven Reality
Empty rooms generate zero revenue. But fixed payment obligations continue regardless of how many guests you have.
Event and Group Variation
Group bookings and events create revenue spikes. Fixed payments do not capture this to accelerate repayment during good months.
Weather and External Factors
Bad weather, economic conditions, and external events affect occupancy unpredictably. Fixed payments ignore these realities.
Off-Season Cash Pressure
Fixed costs continue during slow season: mortgage, insurance, utilities, core staff. Fixed loan payments add to this pressure.
Pre-Season Investment Timing
Need capital for preparation when cash is lowest. Want to repay when peak season revenue arrives.
Revenue-Based Financing Process
From application to funding in days, with payments that match your occupancy.
Application
Complete application with property information focusing on revenue patterns.
10 minutes
Bank Statement Review
Upload 4-6 months of bank statements showing seasonal deposit patterns.
Upload statements
Revenue Analysis
We structure financing based on your deposit patterns and seasonal capacity.
24-72 hours
Funding
Accept offer and receive funds. Repayment automatically tracks with deposits.
Same or next day
Financing That Matches Occupancy Patterns
Revenue-based financing calculates payments as a percentage of your deposits. Full house generates higher payments when you can afford them. Empty rooms generate lower payments when you need relief. Finally, financing that understands hospitality.
Automatic Seasonal Adjustment
Payments adjust automatically with your revenue. No seasonal payment schedules to negotiate. It just works.
All Revenue Streams
Room revenue, F&B, events, and ancillary all deposit and contribute. Complete property performance matters.
Occupancy Aligned
High occupancy means high revenue and higher payments. Low occupancy means lower payments. Perfect alignment.
No Payment Shock
Never face peak-season payment during slow months. Your obligations scale with actual performance.
Fast Approval
Most applications receive decisions within 24-72 hours. Funding deposits same or next day.
Credit Flexibility
Deposit history and revenue patterns matter more than credit scores. Strong deposits overcome challenges.
Revenue-Based Financing for Hospitality
Situations where revenue-aligned payments provide the right solution.
Seasonal Property
Beach resort, ski lodge, or seasonal motel with dramatic occupancy swings. Perfect fit for revenue-based.
Typical funding: $50K-$200K
Pre-Season Preparation
Get capital for staff and supplies. Repay automatically when peak season revenue arrives.
Typical funding: $25K-$100K
Property Improvements
Renovate during slow season. Lower payments during work, higher as improved property generates more revenue.
Typical funding: $40K-$150K
Equipment Investment
Replace equipment with payments that flex with the revenue improvement it generates.
Typical funding: $25K-$100K
Event Capacity Building
Invest in wedding or conference capabilities. Repay through event revenue as it materializes.
Typical funding: $30K-$100K
Marketing Investment
Fund campaigns during slow season. Repay through the bookings the marketing generates.
Typical funding: $15K-$50K
Revenue-Based vs. Other Hospitality Financing
Understanding when revenue-based financing fits best.
| Feature | Revenue-Based | Term Loan | Working Capital |
|---|---|---|---|
| Payment Structure | % of deposits | Fixed monthly | Fixed schedule |
| Seasonal Adjustment | Automatic | None | Negotiated |
| Peak Season Payment | Higher | Same | Same |
| Slow Season Payment | Lower | Same | Same |
| Speed | 24-72 hours | 1-3 weeks | 24-72 hours |
| Credit Focus | Revenue patterns | Credit score | Mixed |
| Best For | High seasonality | Stable revenue | Moderate variation |
| Typical Share | 5-10% of deposits | N/A | N/A |
Revenue-Based Financing Requirements
Qualification focuses on deposit history and revenue patterns.
Monthly Deposits
Consistent deposits showing seasonal patterns and property revenue.
$30,000+ monthly average
Property History
Operating hospitality business with at least one full seasonal cycle.
12+ months preferred
Peak Season Performance
Clear peak season revenue demonstrating ability to support payments during good months.
Strong peak season
Business Bank Account
Active property checking showing revenue and operational patterns.
4-6 months statements
No Active Bankruptcy
Cannot be in active bankruptcy proceedings. Past discharged bankruptcy may be acceptable.
No active BK
Positive Revenue Trend
Stable or growing revenue patterns. Declining trends raise concerns.
Stable or growing
Revenue-based financing emphasizes deposit history and seasonal capacity over traditional credit metrics.
Real Results
Mountain View Lodge
35-room Ski Lodge, Vermont
The Challenge
December-March generates 75% of annual revenue. The owner needed $80,000 for off-season improvements but dreaded making fixed payments during the slow April-November period when occupancy drops to 25%.
The Solution
Revenue-based financing at 8% of deposits. Peak ski season months generated $6,000-$8,000 in payments. Off-season months averaged $1,200-$1,800. Automatic seasonal adjustment.
The Result
Improvements completed during fall. Lodge opened ski season with upgraded amenities. Strong winter payments accelerated repayment. Total repaid within 16 months without any off-season cash flow stress.
“Ski season handles the heavy lifting on payments. Off-season, payments drop to almost nothing. It is the only financing structure that actually makes sense for a seasonal lodge.”
Hospitality Revenue-Based Data
Industry statistics on revenue-based financing for hospitality.
Why Hospitality Businesses Choose Revenue-Based
Strategic advantages of revenue-aligned financing.
Seasonal Stress Elimination
Stop worrying about off-season payment pressure. Payments automatically match your actual revenue.
Peak Season Acceleration
Strong seasons pay down the balance faster. Your success funds faster repayment.
Weather Protection
Bad weather season reduces revenue and payments together. Natural protection against external factors.
All Revenue Captured
Room revenue, F&B, events, and ancillary all contribute. Complete property performance matters.
Simple Budgeting
Know your revenue share percentage. Easy to project payments based on expected occupancy.
Growth Aligned
As property revenue grows, repayment accelerates. Financing scales with your success.