Revenue-based financing (RBF) is non-dilutive capital repaid as a fixed percentage of monthly revenue — typically in the single digits — until the investor has received an agreed multiple of the amount advanced, commonly in the 1.3x–2.5x range. There is no fixed maturity in the classic form: repayment accelerates when revenue grows and breathes when it contracts. The funder underwrites the revenue stream itself, which is why RBF clusters around businesses with recurring, predictable income — SaaS, subscriptions, e-commerce with stable margins.
Positioning against the alternatives is the analytical core. Versus equity: no dilution, no board seat, no governance — but a real cash cost and a monthly drain on working capital. Versus venture debt: RBF usually involves no warrants and lighter covenants, but a higher effective cost; venture debt suits venture-backed companies between rounds, RBF suits revenue-generating companies that may never raise venture capital at all. The effective annualised cost of an RBF facility depends on how fast you repay — a 1.4x cap repaid in 14 months is expensive money; the same cap over 4 years is cheap. Model scenarios, not the multiple.
Turkish law characterisation
Turkish law has no dedicated RBF regime; the contract is an atypical financing agreement under the freedom-of-contract principle of the Code of Obligations. Characterisation matters for two practical reasons: a structure read as a loan from a non-bank lender engages lending-regulation and withholding questions, while participation-style structures must avoid accidentally creating an ordinary partnership (adi ortaklık) with its joint-liability consequences. Cross-border RBF into Turkish companies is therefore usually documented under foreign law at a holdco level in flip-up structures, or carefully localised with Turkish counsel on tax (stamp tax, withholding, KKDF exposure) before signing.
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