What are the key considerations when evaluating e-commerce revenue-based financing versus traditional invoice financing for drinks brands?

Revenue-based financing (RBF) can work for e-commerce sales, but members' experience suggests it's only worthwhile under specific conditions. The headline APR rates (3–4%) are misleading because repayment is fast; the effective cost is much higher once you account for the quick payback schedule.

**When RBF makes sense:** - Only viable if D2C/e-commerce represents 25% or more of your sales and you're actively cash-strapped - Works best when traditional cash flow is tight and you need immediate liquidity

**When traditional invoice financing is better:** - If D2C is a smaller portion of revenue (e.g. 5%), invoice financing on larger B2B orders is more cost-effective - Particularly attractive if your B2B customers (grocers, etc.) have long payment terms (e.g. 90 days); the financing cost is justified by the extended payback period - Offers better economics on larger invoice values

**Key caveat:** The quoted APR on RBF deals is not directly comparable to traditional financing APR because of the compressed repayment timeframe. Crunch the actual numbers on repayment speed and total cost before committing.