The idea: repayment that moves with sales
Revenue-based financing ties repayment to what the business brings in. In a good month more goes toward the balance; in a thin month, less. A fixed bank installment is the opposite: the same number due on the same day, regardless of how the month went.
The appeal for an owner is not that it is cheap, but that the payment tracks the deposits. We do not quote rates or terms on this page, because they depend on the file. Funding ranges from $25,000 to $5,000,000.
Why this suits some Modesto businesses
Modesto is the county seat and largest city in Stanislaus County, and Wikipedia places it in the San Joaquin Valley, surrounded by farmland. Businesses that serve that setting live with a calendar: planting, harvest, processing, shipping. The summers are hot and dry, according to the same source, and anything that depends on foot traffic or outdoor work shifts with the weather too.
A fixed monthly payment is built for steady income. A revenue-linked one is built for the opposite, which is why a farm-supply store, a food producer or a seasonal caterer can find it a closer match.
A worked example (illustration only)
Take a packaging supplier that deposits $60,000 in a busy month and $25,000 in a slow one. Suppose, purely for illustration, that repayment took a fixed share of deposits. In the busy month more would go toward the balance, and in the slow month the owner would keep more of what came in. A fixed payment sized to the busy month would feel very different in the slow one. These figures show a structure; they are not our terms or a typical outcome.
Where it does not fit
- Very thin margins. If a share of every deposit leaves, the business needs enough margin to carry that.
- Lumpy invoices. If revenue arrives as a few big payments, the timing can be irregular. A line of credit is sometimes a better bridge.
- One-off purchases. A single machine usually fits equipment financing better.
Applying
We consider FICO scores of 500 and above, ask for about three months of business bank statements, require no tax returns, and use a soft credit pull on a five-minute application. Sole proprietors can apply and funding can arrive in as little as 24 hours. Comparing alternatives? See merchant cash advances, term loans and working capital. Use the application when you are ready.