Compare ecommerce financing options — Shopify Capital, Clearco, bank loans.
Inputs
e.g. 1.10 = 10% factor; or APR like 10
For revenue-based holdback calc
% of daily sales withheld
Results
Total to repay—
Total interest/fee
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Effective APR
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Months to repay
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Comparison: same principal, different financing
Option
Total Cost
APR
Total Repay
About this calculator
Revenue-based financing has become the dominant DTC capital source in 2026 — Shopify Capital, Clearco, Wayflyer, Pipe, and others all offer the same basic structure: cash advance against future revenue, repaid via daily holdback. The marketing positions these as "no interest" loans. The math says otherwise — effective APRs of 25-50% are common.
This calculator does the honest math. A 10% factor rate ($100K → $110K to repay) sounds cheap until you realize it\'s repaid over 6-9 months. That\'s an effective APR of 20-40%. Compare to a bank line of credit at 8-10% APR — for the same dollars, traditional lending is dramatically cheaper if you qualify.
Where revenue-based works: short-term inventory or marketing investment with payback under 6 months, where you can absorb the high APR because the deployed capital generates returns faster than financing costs accumulate. Where it doesn\'t work: working capital, long-term growth investment, or anything you\'d hold for 12+ months.
The hidden cost of revenue-based financing is the daily holdback. 12% of every sale gets withheld automatically. If you need that 12% to fund ad spend or new inventory, you\'re effectively trading current cash flow for the advance — which can create a "treadmill" where you take another advance to cover the gap. Pair this with the Cash Flow Runway and Monthly Burn Rate calculators before borrowing.
Frequently asked questions
How does Shopify Capital compare to Clearco?
Shopify Capital: 10-12% factor rate (so $100K becomes $112K to repay), repaid as % of daily sales (10-15%), no fixed timeline. Clearco: similar 6-12% factor rate but with fixed repayment cap. Both are revenue-based — you pay more in good months, less in slow months. Effective APR is typically 25-50%.
What's "factor rate" vs APR?
Factor rate is the multiplier on principal (1.10× = 10% factor). APR is annualized cost. A 10% factor over 6 months = ~20% APR. Over 12 months = ~10% APR. Always convert factor rate to APR for honest comparison against bank loans (which quote APR directly).
Should I use revenue-based financing?
For inventory or marketing investment with quick payback (3-6 months): yes, revenue-based works because you can absorb the high effective APR. For long-term capital needs (12+ months): banks or SBA loans at 7-10% APR are dramatically cheaper.
How does the daily holdback work?
Shopify takes 10-15% of every transaction automatically until the advance is paid back. You don't miss payments because they're withheld at source. Trade-off: cash flow is squeezed proportionally to revenue, which can starve growth when you need cash to reinvest.
When do these loans get expensive?
When your business slows down. A 12-month repayment based on 12% holdback assumes consistent revenue. If revenue drops 30%, repayment stretches longer, and the effective APR rises. Don't take an advance if next 6-12 months of revenue are uncertain.