The revenue loan: “Flexibility is everything in a seasonal business such as ours”

The Chancellor of the Exchequer stated in the Autumn Statement that there has been growth in businesses up and down the country. SME’s are vital to Britain’s ability to meet the target of reaching the surplus in 2020. It is, therefore, completely necessary for businesses to be able to access finance in order to grow and directly influence the growth of the country as a whole. With the banks refusing to lend to most younger businesses, Crowd2Fund is able to identify the most innovative and growing businesses that can raise the necessary funds which will allow the to continue their growth plans and expansion and ultimately play a major fuel the economy.


However, it is still the case that for a younger growing or seasonal businesses a traditional loan can increase too much additional stress on a business specifically through quieter periods as the business pays back a fixed rate of interest each month. Crowd2Fund has introduced a more responsible way to lend, and more superior product compared with the standard loan, called the Revenue Loan which offers competitive rates as low as 10% APR and as high as 15% APR up to a period of 5 years. The criteria to qualify is 6 months of proven profitability meaning young businesses are able to raise the necessary funds in their vital growth stage. The benefit of a revenue loan is the flexibility of the repayment of the loan and enables monthly repayments which are directly dependent on the month’s turnover.


This allows the business to utilise the loan to focus its spend on the key areas of the limited company enabling it to expand and grow. A good example of this is the recent success story of Ruroc, a leading snow sports brand, who utilised their revenue loan to relocate their manufacturing plant in order to increase their profit margins, as well as increase their marketing activities in the lead up to the winter months. Being a seasonal business, the majority of sales were achieved in the latter end of each year. The cash flow from the loan and flexible repayments allowed them to expand on an international as well as national level, quicker and more effectively in time for the ski and snowboard season ramping up their marketing efforts and increasing their production capacity.


A recent survey carried out by Santander (1) revealed the importance of smaller businesses being able to access funds specifically through the quieter periods of the year. The report identifies that two out of three UK businesses are affected by seasonality. It also highlighted that businesses did not have a clear strategy in place to be able to fund their business through the quieter periods and many resulted in using credit cards.


Businesses need money as they enter their peak, and money as they come out of this busy period. A great example of this is La Gelateria, a business Crowd2Fund will be raising for. This award winning rustic and homemade ice cream parlour is exceptionally busy during the summer but needs cash flow during the winter months to be able to cover the hefty upfront costs before the season starts again such as manufacturing fees, expenses such as vendor invoices and other overheads. A revenue loan is, therefore, a fantastic way for this young business to aid its growth by allowing La Gelateria to access funds which they would not ordinarily be able to get from the bankbut also have a flexible repayment structure allowing them to make payments on the loan in relation to their monthly turnover. Not only do they gain access to these vital funds via crowdfunding but they are able to create new brand ambassadors and new customers by involving the people who believe in their product and brand.


On the other side, the crowd is able to support the SME by investing in something they believe in and at the same time receive generous rewards such as a discount card on all purchases as well as a better return on their investment.


There is always risk involved in any investment but Crowd2Fund has a rigorous risk process in place to limit the risk of a default as much as possible by working with proven and established brands and businesses.



Crowd2Fund is proud and excited to be paving the way for a new era of finance and being able to support innovative, growing businesses with products such as the revenue loan is a thrill in itself made even better when you see the success stories of businesses who have raised with us. If you know of any business that would benefit from a revenue loan get in touch.


(1) http://www.boostcapital.co.uk/blog/top-financial-tips-for-seasonal-businesses-uk/ 

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Risk warning

Investments like these involve risks including loss of capital. Please see our risk section before making an investment decision