Recording: How to Raise Revenue-Based Financing in SaaS

Hi there —

Today we had a members-only webinar on How to Raise Revenue-Based Financing in SaaS. You can watch the webinar recording here.

While live attendance was just for our SaasRise members (apply to join us here), we often send around recordings to our full email list.

So here’s the webinar recording and slides from this week’s webinar as our gift. We hope it’s helpful!

RBF is a great way to get the capital you need to accelerate investments in growth and R&D as a bootstrapped firm, without experiencing dilution from giving up equity to VC firms.

Thank you to our excellent panelists today…

• Nathan Latka, CEO and Founder of FounderPath

• Keith Harrington, COO and Co-Founder of Novel Capital

In the webinar, we covered:

• How SaaS founders can scale without selling their souls to venture capitalists

• What is Revenue-Based Financing?

• How to strategically use debt to fuel ARR growth

• Comparing non-dilutive Revenue-Based Financing (RBF) over traditional venture funding

• The story of how SaasRise took a $170k RBF financing in May 2024 to accelerate S&M investment (which led to growing ARR from $1M to $4M)

• What lenders look for when

  evaluating SaaS businesses for financing and how best to prepare

• Important terms to consider when evaluating RBF providers

• Expected effective interest rates for RBF

• Common pitfalls to avoid when securing non-dilutive capital

• Examples of companies that have successfully used RBF to scale

How SaaS Founders Can Scale Without Selling Their Souls to VCs 🚀

Venture capital isn’t the only way to grow your SaaS company. In fact, for 95% of founders, it’s not the best way.

Revenue-Based Financing allows SaaS founders to raise capital against future revenue without giving up equity, control, or board seats. Instead of selling a chunk of your company, you take a loan and repay it as a small percentage of revenue over time.

It’s fast, flexible, and founder-friendly.

Why Consider RBF?

💰 Keep Your Equity – Retain ownership and control
⚡ Fast Funding – Get approved in 72 hours
📈 Growth Without Pressure – No need to hyper-scale for a VC’s exit timeline
🛠 Use Funds Where They Matter – Invest in marketing, hiring, R&D, and product
🤝 No Personal Guarantees – No risking your house

My Own Experience with RBF

When building SaaS Rise, we wanted to scale sales & marketing without raising VC. Instead, we took $170K in RBF from FounderPath in May 2024.

📈 We grew from $1M ARR to $4M ARR in 9 months.
📅 Got approved in 72 hours.
🏦 No dilution. No loss of control. Just growth.

Who Should Use RBF?

✅ SaaS companies with at least $350K ARR
✅ Founders with positive unit economics (LTV:CAC ratio 6:1 or higher)
✅ Teams that want to scale smartly without external pressure

VC vs. RBF: The Big Picture

Venture Capital: High stakes, high pressure, big dilution
Revenue-Based Financing: Keep your equity, grow sustainably, repay as you scale

Key Takeaways from the Experts

⚡ Nathan Latka: “We love cockroach SaaS—predictable, steady growth beats hypergrowth with no profits.”
⚡ Keith Harrington: “Only 0.25% of startups actually need VC. The rest can thrive with non-dilutive capital.”
⚡ Ryan Allis: “RBF helped us scale without giving up ownership. SaaS founders have more options today than ever.”

If you’re a SaaS founder looking to scale without selling your soul to VCs, RBF is worth exploring.

👀 What’s your take? Would you raise capital via RBF instead of VC?

Useful RBF Resources

These resources may also be helpful to you as you prepare to raise non-dilutive capital.

• Revenue Based Financing Case Study

• The Guide to Non-Dilutive SaaS Growth Capital

• Video by Ryan Allis on How to Use Revenue Based Financing for Growth

• SaaS Growth Course Lesson on Revenue Based Financing

• Webinar Recording 

• Webinar Slides

AI Summary of the Webinar on Revenue-Based Financing (RBF)

The webinar, hosted by Ryan Allis, CEO & Co-founder of SaasRise, featured Keith Harrington (COO of Novel) and Nathan Latka (Founder of FounderPath). The discussion focused on how SaaS companies can raise capital using revenue-based financing (RBF) as an alternative to venture capital (VC) and equity financing.

Key Takeaways

1. What is Revenue-Based Financing (RBF)?

   • RBF allows SaaS businesses to borrow capital against future revenue.

   • Instead of giving up equity, founders repay the loan as a percentage of revenue over time.

   • Typically, companies can raise up to 50% of their ARR using RBF.

   • Major players include FounderPath, Novel, and other fintech firms.

2. Advantages of RBF Over Venture Capital

   • Non-dilutive – Founders retain 100% of equity.

   • Faster and simpler – Some RBF firms approve loans in 72 hours.

   • Less pressure for hypergrowth – Unlike VC, there’s no pressure to scale aggressively.

   • Predictable repayment structure – If revenue slows, repayments adjust accordingly.

3. Who Should Use RBF?

   • Companies with recurring revenue models (SaaS, subscription businesses).

   • Businesses that have product-market fit but want to scale faster.

   • Founders who want capital but don’t want to sell equity or take on VC pressure.

   • Typically, companies with at least $350K ARR are eligible.

4. How RBF Works

   • Companies connect their financial data (Stripe, bank accounts, accounting software).

   • Lenders assess revenue trends, churn, growth rates, and cash flow.

   • Capital is wired within days after approval.

   • Repayments are made monthly as a fixed or variable percentage of revenue.

5. Comparison: RBF vs. Venture Capital

   • Venture Capital: High-growth expectations, long fundraising cycles, loss of control, high dilution.

   • RBF: No equity loss, flexible payments, ideal for steady-growth companies.

6. Challenges & Considerations

   • Cost of Capital: RBF loans generally have interest rates of 16-23%.

   • Payback Structure: Typically 2-4 years with a fixed monthly repayment or revenue-based percentage.

   • Not Ideal for Pre-Revenue Startups: Companies need proven revenue to qualify.

   • Limited Funding Size: RBF works best for scaling within a sustainable growth model, not large expansions requiring heavy upfront capital.

7. Alternative Uses for RBF

   • Sales & Marketing Expansion (e.g., paid ads, outbound sales).

   • Hiring & Product Development (ramping up an engineering or customer success team).

   • Debt Consolidation (refinancing high-cost loans).

   • Delayed Draw Term Loans (structured funding for acquisitions or growth strategies).

8. Case Study: SaaS Rise Using RBF

   • SaasRise raised $170K in May 2024 from FounderPath.

   • Used funds for customer acquisition and scaling.

   • Resulted in revenue growth from $1M to $4M ARR in 12 months.

9. Key Metrics Lenders Look For

   • ARR Growth Rate (Steady > Explosive).

   • Churn Rate & Retention (Lower churn = better loan terms).

   • Profitability & Cash Flow (Ensuring ability to repay).

   • CAC vs. LTV Ratio (Efficient capital deployment).

Final Thoughts

• RBF is a great alternative for SaaS founders who want to scale without losing ownership.

• It’s not for everyone—VC might still be ideal for businesses targeting hypergrowth or massive market disruption.

• Lenders like Novel & FounderPath are making RBF more accessible with fast approvals, fair terms, and founder-friendly structures.

For more information on our community for SaaS CEOs and founders, visit www.saasrise.com.

We’re here to help you grow and successfully exit!

All the best,
Ryan Allis, CEO & Co-Founder
SaasRise
The #1 Community for Experienced SaaS CEOs & Founders
www.saasrise.com

P.S - If you like great content like this and you’re a CEO or Founder of a software firm with $1M to $100M in ARR, apply to join SaasRise here.

Join Our Community of SaaS CEOs & Founders

Thanks for reading. We hope this guide has been helpful to you. Please take a moment to learn more about SaasRise, our community for SaaS CEOs and Founders. We welcome all CEOs and Founders with $1M-$100M in ARR to join us. We hold three masterminds each week for our members and provide an in-depth library of SaaS growth, fundraising, and exit resources. You can apply here.

Thanks for reading! If you liked this article, join the SaasRise community at www.saasrise.com for even more helpful growth content and weekly SaaS CEO masterminds.

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