To learn more about Libertas Funding and decide if it’s right for your needs, please continue reading:
The need for small business funding and the reluctance of banks to provide it has led to a massive increase in alternative funding options. Libertas Funding is an online financial services enterprise that funds revenue-based financing.
However, the company is not a good fit for every small business. Its high credit score, time in operation, and revenue requirements are geared more toward medium-sized companies.
We can help you decide if the online funder is right for your needs by covering the benefits, drawbacks, and application process. Specifically, we’ll answer these questions and more:
Libertas Funding, LLC is a financial technology firm that specializes in direct funding for revenue-based funding (RBF) transactions. This review focuses solely on its RBF product.
This funding solution is designed to help fuel growth for small and medium-sized businesses (SMBs). The company boasts over 100+ years of combined funding and credit expertise, which underscores its deep understanding of the financial needs of businesses.
The company recently underwent a brand refresh with a new logo and website redesign. The previous logo was:
Since its founding, the company has funded over $2.6 billion in RBFs for SMBs. It is based in Greenwich, CT, and its RBF products are available in all 50 states and Washington, D.C. Libertas Funding claims to help businesses double their revenue over a period of four years, highlighting its potential impact on business growth.
The company prides itself on relationship management and repeat business. It uses a fintech platform to analyze a business’s financials and approve funding quickly. Its team of financing experts provides hands-on service to help business owners through each step of the process. They prioritize providing their clients access to tailored funding solutions, ensuring each business’s unique needs are met. Customer service is further enhanced by building long-term client relationships and fostering trust and reliability.
The company emphasizes its ability to close capital deals efficiently, ensuring timely access to funding. Unlike impersonal automated services, Libertas Funding prides itself on not being robots, offering a personalized approach to each client. Many reviews highlight the importance of communication from Libertas throughout the funding process, showcasing their commitment to keeping clients informed and engaged.
The funder’s revenue-based financing product is a modified merchant cash advance. It’s technically not a loan but a purchase of your future receivables at a discounted rate.
After receiving the RBF, you pay the amount, plus a factor rate (and modest origination fees), with a percentage of your sales revenue, called a remittance rate. The funding solution lets you quickly gain working capital without adding debt to your balance sheet.
The funder’s revenue-based financing product is technically not a loan but a purchase of your future receipts at a discounted rate.
The funder has specified qualifications for its products. Libertas expresses the importance of the customer and their credit history for refinances.
Minimum Requirements for Revenue-Based Financing:
** The company states that if other qualifications are strong, it may be possible (on an exception basis) to get approved with a credit score under 630.
Digital platforms facilitate faster communication between lenders and borrowers. Technology-driven platforms in lending streamline decision-making processes. Data analytics in financial technology allow lenders to assess creditworthiness more efficiently.
Real-time data processing improves transparency in loan approvals and funding decisions. Machine learning algorithms help lenders identify risk more effectively in the lending process. The company recognizes that no two businesses are alike and doesn’t use the same model for each.
The company is primarily an RBF funder providing small business financing solutions. It uses data to deliver quick and meaningful decisions. It is important to note that the company’s policies and practices are subject to change, and consumers should stay informed about any updates. Unfortunately, the funder does not publish its rates publicly for its products, so it isn’t easy to estimate costs.
Most revenue-based financing products use factor rates. This form of payment is easy to calculate but can be more expensive than a traditional APR.
RBF companies such as Libertas typically charge factor rates ranging from 1.05 (pre-payment sales if an RBF deal is repaid very quickly) – 1.30. Multiply the advance amount by the factor rate to determine your cost. For example, if you received an advance for $250,000 at a factor rate of 1.25, the formula would be:
$250,000 x 1.25 = $312,500. You’d pay $62,500 for the advance of $250k.
The funder also doesn’t publish any information on fees. However, one review suggests the company charges origination fees ranging from 1% to 3% of the total amount. On the website, Libertas Funding states that your credit score, revenue, and time in business will determine your rates.
The funder provides a business loan affiliate program. ISOs and business funding brokers can register as partners by completing and submitting an online form on the company’s website.
The application process for Libertas Funding services is quick and simple. Follow these steps to apply.
You can choose to apply for revenue-based financing.
After choosing a product, you’ll register an account with the company.
Once you create an account and submit the initial application, you’ll be prompted to upload the required documents. Be prepared to provide the following:
At this point, a Libertas representative will contact you to finalize your application and review your funding options, rates, and payment terms.
After reviewing your application and financial documents, Libertas Funding will issue either a pre-approval or a denial. If pre-approved, you’ll receive an offer outlining the terms, funding amount, and repayment details. Some funding requests may be fulfilled within 48 hours, ensuring a fast and efficient process.
To move forward with the funding, you’ll need to review and accept the offer, provide any outstanding documents, and ensure all compliance requirements are met. Efficient processes can enable funding without delays caused by market negotiations, allowing you to access capital quickly.
Once all necessary steps are completed, a final funding call will occur. This call confirms that all agreements are in place and that closing stipulations, such as final documentation or approvals, have been met.
Once approved, you will receive your funds via ACH or wire transfer.
The remittance transactions for revenue-based funding are automatically processed with an ACH transfer from your business bank account. You can choose daily or weekly payments, but bi-weekly or monthly payments are sometimes available. Libertas Funding shows that it cares about its customers by offering flexible payment options and ongoing support. The lending process is designed to be flexible to accommodate the diverse needs of businesses, ensuring a tailored approach for each client.
The strength of your credit profile and business revenue and the payment structure of any existing debt determines your payment frequency. The remittance will continue until the amount due is paid in full.
There are no prepayment penalties for paying off the RBF early. In some cases, you might get a significant prepayment discount for paying off early.
Many customers renew revenue-based funding (RBF) with the company. It estimates that over 70% of its funding goes to returning customers.
Like many alternative funding options, the company provides a quick and easy application process with a fast turnaround on decisions. RBF provides quick funding, and the RBF product can sometimes provide same-day financing and offers flexible funding amounts.
SMBs may also get large RBF amounts. There are no prepayment penalties, and you might be able to save money with early payment discounts. Libertas Funding prides itself on transparent processes, ensuring there are no hidden fees or unexpected costs.
It also has a good renewal program. Libertas leads the industry in customer satisfaction by prioritizing understanding individual business needs and providing tailored funding solutions. Customer experiences with Libertas often highlight strong team responsiveness.
The funder doesn’t provide any public information on rates for fees. You cannot estimate costs without applying and seeing your available rates. Ensure your cash flow can handle the repayment frequency and amounts before signing any agreement.
It also has very high eligibility requirements. The credit score cutoff is one of the highest for revenue-based financing. The typical revenue requirement of $75k monthly will disqualify many small businesses.
Pros:
Cons:
Yes, Libertas Funding is a legitimate revenue-based funder and fintech platform. While the company is not Better Business Bureau (BBB) accredited, it does have an A+ rating on the watchdog site.
The funder has primarily positive reviews. It has a 4 out of 5 rating on eight Google reviews and a 4.9 out of 5 rating on 79 Trustpilot reviews. Ethical lending practices focus on transparency and effective communication. Leading with integrity is an essential principle in ethical lending practices, and ongoing communication is vital to maintaining positive relationships in lending.
Customers who rated the company highly praised the ease of the process, customer service, and fast funding. Many reviews discussed the funding amounts and recommended the company.
The company has a high revenue requirement and comparatively high credit score requirements. It’s also possible to get denied due to your industry.
If you were declined, the denial letter should explain why. If you need more information, such as when to reapply, contact the funder directly by phone or in writing.
Fortunately, there are many online funders to consider if Libertas Funding doesn’t work out. Researching different lenders can help your business find optimal funding solutions.
You should be able to find a revenue-based funding provider with a much lower credit score and revenue requirements. Some lenders focus on reducing unnecessary paperwork, which can speed up the funding process.
You might also be interested in a funder or a funding marketplace that can offer the following small business financing:
Libertas Funding is best suited for SMBs earning over $900,000 annually who need fast funding. It’s also a good option if you’re seeking an ongoing relationship with a funder for multiple financing rounds.
High-revenue companies with excellent personal and business credit can likely qualify for lower-cost and longer-term financing options. You may need to find a different funder if your business generates less than $75k in sales monthly.
Based on the available products, user reviews, and eligibility requirements, we rate the company at 4 out of 5. It does have excellent reviews, but the high revenue requirement excludes many small businesses. In addition, the lack of complete transparency on costs is a concern.
Disclaimer: The Libertas Funding trademark is owned by Libertas Funding, LLC and its use herein is for reference purposes only and it does not indicate sponsorship or endorsement from Libertas Funding, LLC.
Fraud Disclosure:
Please be aware that individuals have been fraudulently misrepresenting to business owners (and others) that United Capital Source, Inc. (“UCS”) can assist small businesses in receiving government grants and other forgivable business loans, when in fact those grants or loans do not exist or are not available. These individuals have ulterior motives and are engaging in the unauthorized use of the names, trademarks, domain names, and logos of UCS in an attempt to commit fraud upon unsuspecting small business owners.
UCS will never communicate with a prospective client on Facebook, Facebook Messenger, or any other type of social media. Further, any email communications will always come from an official UCS email address and not a Gmail, Yahoo, or other email domain. If you believe you have been contacted by someone posing as an employee of UCS, please email [email protected].
