Revenue Based Financing in Canada
Revenue based financing gives your business capital repaid as a fixed percentage of the revenue you generate, until a pre-agreed total is reached. No equity given up, no board seat, no fixed monthly payment, no collateral. Repayment scales with your business: faster in strong months, lighter in slow ones.
That is exactly how a Magical Business advance works. Our merchant cash advance is revenue based financing in its most established form: up to $300,000 for Ontario businesses, backed by Magical Credit Inc., a Canadian lender operating since 2014, with most decisions inside 24 hours. Apply now or see how the numbers work.
How revenue based financing works
Three terms define the deal:
- The capital: the lump sum advanced to your business, up to $300,000 with us.
- The repayment total: a fixed amount set upfront as a multiple of the capital (the factor rate). Agreed before you sign, never grows.
- The revenue share: the fixed percentage of daily or weekly sales remitted until the total is reached.
Example: $100,000 of capital at a 1.25 factor rate and a 10% revenue share. You repay $125,000 in total, remitting 10% of sales until done. Revenue doubles, you finish early at no extra cost. Revenue dips, your payment dips with it. There is no compounding interest anywhere in the structure.
Who revenue based financing suits
RBF was built for businesses with consistent revenue that do not want to trade equity or take on rigid debt:
- Retail, hospitality and healthcare businesses that want capital without bank-scale process or collateral
- Ecommerce brands funding inventory and marketing ahead of the revenue it produces
- Service businesses and agencies smoothing lumpy project income
- Seasonal businesses that need repayment to breathe with the calendar rather than fight it
If your revenue is consistent, the financing fits around it. Who qualifies.
Revenue based financing vs equity
Selling 10% of your company to raise $100,000 costs you 10% of everything the business ever becomes. Revenue based financing costs a fixed, known amount, and then it is over. No dilution, no investor approval on decisions, no exit pressure. For owners whose problem is timing of capital rather than scale of capital, RBF is usually cheaper by an order of magnitude.
Revenue based financing vs a merchant cash advance
They are the same principle; the merchant cash advance is the longest-established form of revenue based financing. If you have seen the two terms treated as rivals, the honest version is this: RBF is the category, and an MCA is the implementation built for everyday businesses with daily and weekly sales. At Magical Business the product is one and the same: revenue-underwritten capital with a fixed repayment total and a sales-linked remittance. Whatever name it arrives under, the numbers to compare are the factor rate, the revenue share, and the total dollar repayment.
Why Ontario businesses choose Magical Business
- A lender, not a marketplace. Your application is underwritten by us, backed by Magical Credit Inc., a Canadian company since 2014. Your file is not auctioned to third parties.
- Fixed cost, in writing, before you sign. The repayment total is the whole story. No warrants, no equity, no fees discovered later.
- Speed. Most applicants receive a decision within 24 hours.
- A real person on the phone. 1-855-639-6888, whenever you have questions.
FAQ
Is revenue based financing debt? It is non-dilutive financing repaid from revenue. Unlike a term loan there is no fixed schedule or compounding interest; unlike equity there is no ownership change. For accounting treatment, speak with your accountant.
What does it cost? A fixed multiple of the capital, set by the factor rate and stated in writing before you sign. A 1.25 rate on $100,000 means $125,000 repaid, full stop.
How much can I raise? Up to $300,000, depending on your business qualifications and revenue.
Do I need to be profitable? Consistent revenue matters more than accounting profit. We consider businesses at various stages.
How fast is funding? Most applicants receive a decision within 24 hours of applying.
Growth capital without giving anything up. Apply now or call 1-855-639-6888