Working Capital using Revenue Base Financing
Get the most out of your working capital by using revenue based financing.
Companies funded
500+
Trades facilitated
€300m
Initial trade
2021
Use Revenue based financing for your working capital.
For businesses with recurring revenue models, securing working capital is crucial, yet traditional financing routes like bank loans or venture capital (VC) can pose challenges.
For bank loans, the issue often lies in the collateral requirements. Banks typically require tangible company or personal assets as security against the loan. However, for many recurring revenue businesses, their most valuable asset is their predictable, ongoing income streams, which traditional banks may not adequately value.
Venture capital, while a popular source of funding, comes with its own set of challenges, particularly when it's sought for working capital purposes. VCs are generally focused on funding rapid growth and scale, not necessarily the day-to-day operational funding needs of a business. Moreover, VC funding often involves relinquishing a portion of equity, which means losing a degree of control over the company.
Revenue-based financing (RBF) emerges as a compelling alternative in this landscape. It appreciates the inherent value of recurring revenue streams, offering funding based on the strength of these predictable incomes rather than traditional assets or equity. This approach is more aligned with the business models of recurring revenue companies, providing them with the necessary capital without the need to sacrifice equity or control.
Our story in numbers
How does it work?
Eligibility criteria
Businesses need a MRR of 30k, positive growth and a broad subscriber base. Your business needs at least 6 months of financial data for our team to analyse. Currently, we fund European businesses across 16 jurisdictions.
Signup & analysis
On signup, businesses connect bank accounts, accounting software and subscription managers to our platform. The Levenue algorithm analyses these datasets, and if deemed eligible, our team provides you with a trading limit.
Funding & pricing
Draw on your trading limit at your discretion. The amount you trade will be offered to investors on Levenue's platform. Our pool of funding partners may then bid on your offering, and come to a fixed price via sealed bids.
Financing Options
Start your funding journey
Frequent FAQ's
How long is the signup process?
The initial phase of sharing all the required data generally takes about 10 to 15 minutes. Following this, there is a 48-hour period during which you will be notified about your eligibility and the corresponding funding amount. Once your deal is live on the marketplace, it may stay active for a period ranging from 1 to 20 days, depending on the response and offers from investors.
What is the eligibility criteria?
Key eligibility prerequisites encompass: possessing a legal entity within an European country where Levenue operates, operating as a subscription-based or SaaS company with monthly or quarterly recurring contracts, demonstrating over 12 months of revenue history, and maintaining a Monthly Recurring Revenue (MRR) exceeding 30K€.
How is the cost of capital determined?
After our analysis is complete, we will issue a trading limit, using data alone. It is at the company's discretion how many of their subscribers they will trade for up front capital. Investors bid in a Dutch Auction for the offered contracts until a discount rate is reached.
What key metrics are evaluated?
We evaluate growth rate, subscriber churn and cash burn. Furthermore, we look at cash flow stability and the indebtedness of a business. We will continue to constantly analyse these key metrics throughout the life of the trade.
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Why do investors diversify their portfolio using Levenue?
The select group of accredited investors has compelling reasons to continue increasing the amount of capital deployed in this new asset class:
Short term exposure
Contracts are purchased for a fixed 12 month term, straight line amortising and not in a 'bullet'. Indemnification made via SEPA Direct Debit Mandate.
Risk mitigation mechanisms
Levenue has developed proprietary de-risking mechanisms, in addition to constant monitoring of API connections to meaningfully reduce downside risk.
Attractive fixed rates
IRR sits at ~23% net of fees, with enviably low late payments and zero loan loss events since inception. Investors have experienced strong risk-adjusted returns.
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