Revenue-Based Financing for Technology Companies
Your MSP has $75,000 MRR that grows 5% monthly. Your SaaS does $120,000 monthly with seasonal enterprise deals. Revenue-based financing ties payments to your actual revenue, creating natural alignment with your growth trajectory and business cycles.
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Revenue-Based Financing for Tech
Revenue-based financing ties repayment to your actual revenue. For IT companies with recurring revenue or predictable business models, this creates natural alignment between growth and financing.
MRR-Centric Evaluation
Monthly recurring revenue provides predictable cash flow that traditional lenders undervalue. Revenue-based financing properly values MRR because payments come from that recurring revenue.
Growth Alignment
As your IT business grows, payments increase proportionally. This natural scaling means financing does not constrain growth and success funds itself.
Revenue Share Mechanics
A 6% revenue share means 6 cents of every dollar deposited goes toward repayment. $100,000 monthly revenue means $6,000 monthly payments. Growth to $150,000 means $9,000 payments.
Non-Dilutive Capital
Revenue-based financing provides growth capital without equity dilution. Keep ownership while accessing the capital needed to scale.
Why Traditional Financing Limits IT Growth
Technology revenue models require financing that understands recurring revenue and growth dynamics.
MRR Undervalued
Banks see $80,000 MRR but apply general business metrics. Your predictable recurring revenue supports much more than they recognize.
Growth vs. Cash Flow
IT companies often must choose between growth and positive cash flow. Fixed payments assume stable operations, not growth investment.
Project Revenue Variation
Beyond MRR, project revenue varies by client timing and contract cycles. Fixed payments ignore this variability.
Equity Dilution Concern
Venture capital provides growth capital but costs ownership. Revenue-based financing is non-dilutive.
Bank Tech Blindness
Banks do not understand technology business models. MRR, churn rates, and LTV/CAC metrics are foreign concepts.
Scaling Constraints
You could grow faster with capital for sales and delivery. But capital access constrains the growth trajectory.
Revenue-Based Financing Process
From application to funding in days, with payments that match your revenue.
Application
Complete application with business information. MRR and revenue data are key inputs.
10 minutes
Revenue Review
Upload 4-6 months of bank statements. We analyze MRR, growth patterns, and revenue quality.
Upload statements
Revenue Analysis
We structure financing based on your revenue patterns, MRR quality, and growth trajectory.
24-72 hours
Funding
Accept offer and receive funds. Repayment automatically tracks with your revenue.
Same or next day
Financing That Scales With Your Growth
Revenue-based financing calculates payments as a percentage of your deposits. As your IT business grows, payments grow proportionally. Your success funds itself without constraining growth.
MRR Properly Valued
We understand recurring revenue. MRR quality, churn rates, and contract terms factor into evaluation and support appropriate financing.
Growth Aligned
Payments increase with revenue growth. Financing does not constrain scaling. Your success funds repayment.
Non-Dilutive
Keep your equity. Revenue-based financing provides growth capital without giving up ownership.
All Revenue Counts
MRR, project revenue, and all deposits contribute. Complete picture of your IT business.
Fast Access
Most applications receive decisions within 24-72 hours. Funding deposits same or next day.
Credit Flexibility
Revenue patterns and MRR quality matter more than credit scores. Strong revenue overcomes challenges.
Revenue-Based Financing for IT
Situations where revenue-aligned payments provide the right solution.
MSP Growth Capital
Scale managed services capacity. Payments grow as new MRR comes online.
Typical funding: $75K-$300K
Sales Investment
Hire sales team to drive growth. Repayment scales with the revenue they generate.
Typical funding: $50K-$200K
SaaS Scaling
Invest in product and growth. Payments align with growing subscription revenue.
Typical funding: $100K-$500K
Hiring Investment
Add engineering capacity. Payments increase as new team members drive revenue.
Typical funding: $75K-$250K
Marketing Push
Fund customer acquisition. Repay through the revenue from acquired customers.
Typical funding: $40K-$150K
Infrastructure Build
Build delivery infrastructure. Payments match the revenue it enables.
Typical funding: $50K-$200K
Revenue-Based vs. Other IT Financing
Understanding when revenue-based financing fits best.
| Feature | Revenue-Based | Venture Debt | Term Loan |
|---|---|---|---|
| Payment Structure | % of revenue | Fixed + warrants | Fixed monthly |
| Equity Impact | None | Often warrants | None |
| MRR Valuation | Primary factor | Valued | Often undervalued |
| Growth Alignment | Automatic | Partial | None |
| Speed | 24-72 hours | Weeks | 1-3 weeks |
| Credit Focus | Revenue quality | Mixed | Credit score |
| Best For | Growth companies | VC-backed | Stable operations |
| Typical Share | 4-8% of deposits | N/A | N/A |
Revenue-Based Financing Requirements
Qualification focuses on revenue quality and growth potential.
Monthly Revenue
Consistent revenue demonstrating business viability. MRR particularly valued.
$40,000+ monthly
Business History
Operating IT business with revenue track record.
6-12 months preferred
Revenue Quality
Recurring revenue, strong client relationships, and reasonable retention.
Quality MRR
Growth Trajectory
Stable or growing revenue patterns. Declining trends raise concerns.
Stable or growing
Business Bank Account
Active business checking showing revenue and operational patterns.
4-6 months statements
No Active Bankruptcy
Cannot be in active bankruptcy proceedings.
No active BK
Revenue-based financing emphasizes revenue quality and MRR over traditional credit metrics.
Real Results
CloudStack MSP
Managed Services Provider, Portland OR
The Challenge
CloudStack had $85,000 MRR growing 6% monthly. They needed $150,000 to hire sales and expand delivery capacity. Banks undervalued their MRR. Venture debt wanted warrants. Fixed term loans would strain cash during growth investment.
The Solution
Revenue-based financing for $150,000 at 6% of deposits. Initial payments around $5,100 monthly. As MRR grew, payments scaled naturally.
The Result
CloudStack invested in sales and delivery. MRR grew to $140,000 within 12 months. Payments grew to $8,400 but represented the same percentage of (larger) revenue. No equity diluted. Growth funded itself.
“Banks did not understand our MRR. VC wanted equity. Revenue-based financing let us keep ownership while payments scaled naturally with growth. Perfect for an MSP building recurring revenue.”
IT Revenue-Based Data
Industry statistics on revenue-based financing for technology companies.
Why IT Companies Choose Revenue-Based
Strategic advantages of revenue-aligned financing.
Preserve Equity
No warrants, no dilution. Keep ownership while accessing growth capital.
Growth Alignment
Payments scale with revenue. Growth is not constrained by fixed obligations.
MRR Recognition
Recurring revenue is properly valued and supports appropriate financing levels.
Flexible Scaling
Pay more during high-revenue periods, less during investment phases.
Fast Decisions
Capital when you need it. Opportunities do not wait for lengthy processes.
Success Funds Itself
As your business grows, financing naturally resolves through increased payments.