Does anyone have experience using revenue-based business loans?

by a searcher

1 year ago

I am submitting an IOI on a Sports Publishing company and I would like to use creative financing to finance part of the deal. The company has about 70% of its revenue in annual recurring revenue (ARR). Please note that this company has been in business for 35 years. 

Has anyone used a revenue-based business loan to finance part of the acquisition of a business? If so, what institution did you use, what did the underwriters look for, and what was the multiple they put on the company's ARR?

If anyone has any other creative financing strategies tied to ARR, please feel free to share! Thank you!

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8 comments

searcher

Hi Tim, thank you for your insight! I will definitely send you a message. Thank you!

1 year ago | like reply | 0 likes

intermediary from University of Toronto

Hi Calixte, I've seen publishers financed from a range of different lenders, from banks to some alternative lenders. The % applied for MRR revenue is a function of a number of factors that need to be analyzed. Ultimately it's a function of the health and stickiness of the revenues, and the credit risk present for the entire business. It also depends on how the rest of the deal is structured. The exercise would probably take a little investigating. If you want to share more details, I can let you know what I think might be possible. My e-mail address is --@----.com

1 year ago | like reply | 0 likes

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