Revenue-Based Financing Calculator: Payback Time and Estimated APR

With revenue-based financing, a provider advances money in exchange for a fixed share of your future revenue. You keep remitting that share each month until you've repaid a cap, usually stated as a multiple of the advance. There's no interest rate, so the cost is the difference between the cap and the advance, plus any fees.

It works like a monthly version of a merchant cash advance. Selling online? Our sister site BestStorefront compares ecommerce financing providers, including Shopify Capital, Stripe Capital, Clearco and Wayflyer.

Each month's payment is that month's revenue multiplied by the revenue share, until the cap is reached; the last payment is whatever remains. Revenue changes by your growth rate every month.

Estimated APR finds the monthly rate at which those uneven payments equal the funds you receive after upfront fees, then multiplies it by 12.

Estimated APR here is a nominal annual rate: the rate per payment period multiplied by the number of periods in a year, the convention APR disclosures use. It isn't an effective annual rate, which compounds and comes out higher. It's our estimate for comparison, not the APR a provider must disclose under state rules, which set their own methods. These formulas are covered by automated tests and checked against independent calculations. Results remain estimates rather than provider disclosures.