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Welcome to Episode 233 of the Success in Business Podcast. We are here for you every Monday to teach you about success in business and today is no different.
Today Tom breaks down revenue-based financing for us. It is a hybrid of sorts: part loan, part credit card. It is similar to a loan because the business gets a lump sum of cash up front to use to finance the business’ growth, perhaps toward the purchase of an asset or to finance production by purchasing machinery. It is also a little bit like a credit card.
The thing that really sets it apart is how it is to be repaid. It will be repaid based on taking a percentage of ongoing revenue. As sales ebb and flow the revenue will likewise fluctuate. So, with a revenue-based financing deal the payments will fluctuate, too.
In a future episode Tom will explain how to know if a revenue-based financing deal is right for you and your business. Thanks for listening!
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