Revenue-based financing
In accounting, revenue-based financing means capital repaid as a fixed percentage of ongoing revenue until a set multiple of the amount advanced is returned. Non-dilutive; costly if revenue grows fast, slow to repay if it doesn't.
Also called RBF.
Not a rule. Financing practice — not codified. US GAAP governs recognition, measurement and presentation, not bookkeeping mechanics. Sources
The lesson that teaches this
From the free founder back-office course, taught on one company's books, with exercises to work it yourself.
What it is not called
Each of these means something else. Use one here and an accountant reading the product notices.
- venture debt
- factoring
Nearby in the catalog
No component names this concept outright. These sit in the same part of the system.
Also in Equity & financing
Defined in Lexicon. This page is generated from that document, so the two can't disagree.