Cash flow loans generally are based on multiple trailing EBITDA, which is not an advanced rate against the assets. It means that the company qualifies for a large loan, in some cases at least five times the amount a bank gives.

Cash flow loans are customized to the borrower’s needs and generally have a term of 5 to 7 years, and repayment is usually backed through the balloon payment. It allows you to defer the loan payments, and you can use the cash flow to grow the business.

Cash flow loans are ideally in a second lien position or an unsecured relative with a conventional bank loan. They will lend deeper into the equity valuation of the business that gives you valuable financing to increase the growth. Generally, there is no need for a personal guarantee.

Cash flow loans are tied to the equity value of your company’s enterprise value. It is because they believe in your equity value, and they are more apt to provide funding for future growth.

Cash flow loans do not get shares in the company but generally have high-interest rates. It is more beneficial to bring in the cash flow lender than the investor. You can hold to the shares and always maintain business control.