Short answer
A single unsecured, cash flow underwritten facility is commonly sized at ten to thirty percent of annual gross income, so a business at $1,000,000 typically sees $100,000 to $300,000 from one product. Reaching $500,000 at that revenue takes collateral rather than more revenue: an asset backed facility priced off equipment or receivables, or two to three coordinated facilities arranged together.
There are two numbers here, and they are far apart. What one product will do, and what a properly built structure will do.
What a single facility does
| Facility | Sized against | Typical outcome at $1,000,000 |
|---|---|---|
| Unsecured term loan | Cash flow and coverage | $100,000 to $300,000 |
| Operating line of credit | Cash flow, margined receivables | $75,000 to $250,000 |
| Revenue based advance | Bank deposits, three to six months | Roughly one month of deposits |
| Invoice factoring | Eligible receivables | 80 to 90 percent of what is outstanding |
| Equipment finance | Appraised asset value | Follows the asset, not the revenue |
Every figure above is a market norm, not a promise. Actual sizing depends on the lender, the file and the security.
Why revenue is the wrong lever
Cash flow lending is capped by debt service coverage. At one and a quarter times, the facility can only be as large as the earnings will carry, and earnings on $1,000,000 of revenue are a fraction of that revenue. Doubling revenue moves the number. Nothing you say about revenue does.
What actually moves it
- Collateral. An equipment sale and leaseback is priced off appraised value, so a $1,000,000 revenue business with $900,000 of unencumbered plant is a different file entirely.
- Receivables. A factoring or asset based line converts invoices already issued, which sidesteps the coverage constraint.
- Structure. Two or three facilities arranged together, each sized correctly against its own asset, reach a total that no single product would.
- Time in business and clean filings. They do not raise the ceiling directly, they decide whether you get the good version of each product.
The stack, in practice
A business at $1,000,000 of gross income with equipment on the floor and a receivable book might reach $500,000 like this: a leaseback releasing $250,000 against appraised plant, a receivables facility providing $150,000 of revolving room, and an unsecured term facility of $100,000 sized off deposits.
It is also where the risk sits. Layering facilities without a single view of the combined remittance is how a business ends up unable to make payroll in a slow month. The schedule has to be built before the first facility is signed, not after the third.
What will not get you there
- A services business with no equipment, no property and a short receivable cycle. Be realistic: the range is lower and the honest number is smaller.
- A business already carrying two merchant advances. Capacity is spent.
- Unresolved CRA arrears. Almost every lender stops there.
Questions
- Is fifty percent of revenue a normal facility size?
- Not from one unsecured product. It is reachable through collateral or through a combination of facilities, which is a different thing and should be described as one.
- Does gross revenue or net income matter more?
- Net, in almost every case. Revenue gets you in the door; coverage decides the size.
- How fast can this happen?
- An asset backed piece can fund in days once the appraisal is done. A bank facility runs four to eight weeks. A combined structure moves at the pace of its slowest part.
Where this shows up in practice
- Equipment and vehicle financingFinance sized against the asset itself, for machinery, fleet and production systems, including sale and leaseback on equipment you already own.
- Working capital and lines of creditRevolving credit sized against deposits, receivables and inventory, for the gap between paying suppliers and getting paid.
- Advisory and deal preparationThe work that happens before a lender sees anything: the request, the evidence, the repayment logic and the lender list.