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Frequently Asked Questions

This page has answers to the most common questions entrepreneurs ask about our financing. If you’re satisfied, apply online and a member of our investment team will contact you within 48 hours.

Do you offer seed funding for pre-revenue startups?

Our revenue-based financing model (also known as a RevenueLoan®) is best suited for companies that are currently generating at least $200,000 in annual revenue. We require a minimum of $15K in each of your last three months. If you’re a pre-revenue startup, you can still apply online so that we can keep you on our radar. You can also sign up for our newsletter to stay in the loop on Lighter Capital and keep us in mind when you get further along with your revenue model.

What type of companies do you fund?

Our revenue-based financing model is best suited for software, SaaS, tech services, digital media, and similar companies. For entrepreneurs in these high-growth, high-margin markets, Lighter Capital’s revenue-based financing is new way to raise growth capital without giving up equity. Entrepreneurs in industries with inherently more hard assets (i.e. collateral) will generally find that there are existing sources of capital that are better suited for their needs. Those industries include real estate, food and beverage, manufacturing, construction, and related services.

Do you only invest in certain geographies?

Currently, Lighter Capital provides RevenueLoans to U.S. companies only. In the future we plan to begin offering funding to companies based outside of the United States. To stay in the loop on Lighter Capital and find out when we’re expanding internationally, sign up for our newsletter.

How much funding can I get?

We’re currently offering $50K–$2M in growth capital to qualified companies. You can qualify for a loan for up to 33% of your annualized revenue run-rate. For example, if you are on track for $1M in sales this year, we can invest about $330k. More about revenue-based financing.

Is revenue-based-financing just a fancy way to say “factoring” or “receivables financing?”

No. Lighter Capital provides revenue-based financing, which means we give you unrestricted capital for growth in return for a small percentage of monthly revenues. “Factors” or “receivables financiers” basically speed up the cash flow from sales that already happened (or are just about to happen). Factoring provides working capital; revenue-based financing is growth capital. It comes with fewer restrictions and impositions on your workflow, and is paid monthly compared to daily or weekly, as with factoring.

What do I owe in return?

We will look for a percentage of revenue (usually between 2% and 8%, never more than 10%) until the total repayment cap is reached. Generally, this is calculated and debited monthly via Automated Clearing House.

If it’s a revenue loan, then what’s the interest rate?

Unlike a traditional loan, revenue-based financing doesn’t have a set payment amount each month. Instead, you pay a percentage of topline revenue. If you beat your plan and grow faster, your payments go up accordingly, but if you miss your plan, your monthly payment goes down.

Do I keep paying this percentage of topline revenue forever?

No. Payments stop when the return cap has been paid back. RevenueLoans are normally repaid over 3–5 years, but if your revenue grows faster than expected, you can pay off the loan sooner.

Can I pay back the loan early?

While you may pay back your loan (plus return cap) at any time, there is generally no incentive for paying back the loan early. We may make an exception if you expect a special event (a VC round, for example) within the year.

What do I get besides just the money? How does Lighter Capital add value?

Lighter Capital’s team has many years of experience funding and scaling startups. Many of our clients who have gone on to raise venture funding made their first connections at VC firms through the Lighter Capital leadership team. If you have a question or problem, chances are someone in the Lighter Capital community has been there before and can help you. Both our team and our community are very supportive, and will help you in any way we can.

Who is Lighter Capital?

We’re passionate about pioneering revenue-based financing. We’re technology entrepreneurs, financial analysts, software engineers, and fintech marketers. We’re ex-angel investors and venture capitalists. But most of all we’re people who love supporting small businesses and startups.

How many investments have you done under this model?

Lighter Capital has made over 250 investments since 2010 and is the market leader in revenue-based financings. We are happy to provide customer references if you still have questions.