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Businsess Loans > Lender Reviews > Uncapped
Established in 2019, Uncapped offers three distinct short-term financing solutions akin to merchant cash advances. Unlike traditional loans, Uncapped charges fees instead of interest rates. Loan approvals are primarily based on the business's revenue flow, with a minimum annual revenue requirement of $1.2 million. For Amazon sellers, this requirement is adjusted to $10,000 in monthly revenue.
Loan Details
- Loan Amounts: $10,000 to $10 million
- Interest Rate: Not applicable
- Term Lengths: 6 to 24 months
Ideal Candidates for Uncapped Loans
Uncapped business loans are well-suited for business owners seeking working capital and capable of generating substantial monthly revenues of $100,000 or more. The service is particularly advantageous for Amazon sellers, as the monthly revenue requirement for these businesses is lowered to $10,000.
Additionally, Uncapped is a viable option for those who prefer not to use business bank loans with personal guarantees or seek venture capital funding that requires relinquishing business equity.
With a requirement of only six months in business, Uncapped is also startup-friendly, provided the startups have robust financials. Small business owners needing short-term loans with repayment periods of six to 24 months might find this lender a good match.
Who Might Find Uncapped Less Suitable
Uncapped might not be the best choice for businesses that do not generate high revenue or need traditional loans and lines of credit. It also does not offer long-term loans. Therefore, businesses preferring manageable monthly payments over two to five years should consider other options.
Additionally, Uncapped is not suited for businesses without online sales. Its platform integrates directly with sales and accounting platforms such as Shopify and QuickBooks to determine loan eligibility.
Eligible Business Types
- E-commerce
- Direct-to-consumer businesses
- Software as a Service (SaaS)
- Subscription-based companies
Detailed Information about Uncapped
- Loan Amounts: $10,000 to $10 million
- Interest Rate: Not applicable
- Term Lengths: 6 to 24 months
- Fastest Funding: As quick as 24 hours
- Minimum Annual Revenue: $600,000
- Minimum Time in Business: 6 months
- Fees: Monthly base fee ranging from 0.70% to 1.50%
Pros and Cons of Uncapped
Pros:
- High loan amounts available
- Welcomes new businesses
- No personal guarantees required
Cons:
- Only for internet-based businesses
- High revenue requirement
- Aggressive repayment schedule
Types of Loans Offered
Uncapped provides various types of working capital loans to online businesses, similar to merchant cash advances or revenue-based financing, securing the loan with revenue. While the main website mentions loan amounts starting at $100,000, specific loan pages indicate loans can be as low as $10,000 for fixed-rate financing and $50,000 for SaaS runway loans. Prospective borrowers should verify with a representative if they need loans below $100,000.
Understanding Uncapped's Fee Structure
Upon taking an Uncapped business loan, businesses agree to share a percentage of their revenue until the loan and fee are repaid. Most businesses share 5% to 25% of future revenue. Besides high revenue requirements, Uncapped prefers businesses with growing revenue over time.
Instead of APRs or factor rates, Uncapped charges a flat base fee percentage of the loan amount. The total loan cost depends on this fee and the repayment duration. For instance, a $50,000 loan with a 1.50% monthly fee over 12 months would incur a base fee of 18%, resulting in a $9,000 fee and a total repayment of $59,000.
To ensure suitability, use a business loan calculator to compare Uncapped’s loan costs with traditional interest-based loans. In some cases, alternative loans may offer lower costs or more manageable payments.
Eligibility Criteria
Uncapped does not require a minimum credit score but is specific about business types and revenue:
- Online-based businesses: E-commerce, direct-to-consumer, SaaS, subscriptions
- At least 6 months in business
- Minimum $50,000 in monthly sales
- About 40% of revenue from online sales
- Positive sales growth trajectory
Application Process
The application is straightforward through Uncapped’s online portal. During the application, you will connect your sales or accounting services to Uncapped, enabling it to analyze your revenue. Uncapped specifically mentions connections with PayPal, Shopify, Stripe, and QuickBooks. Applicants will receive a quote within 24 hours.
Required Information for Application
- Business name
- Country
- Monthly revenue
- Type of business
Additional Insights
Uncapped does not require a minimum credit score for business loan approval. Instead, the focus is on monthly revenue, requiring an established $100,000 monthly with a growth trajectory, or $10,000 monthly for Amazon sellers.
For businesses generating $100,000 or more in monthly revenue, securing financing from Uncapped can be a swift and straightforward process. However, the revenue requirements are notably stringent compared to other online lenders, where merchant cash advances typically have more lenient criteria and prioritize higher approval rates.
Uncapped’s revenue-based financing operates similarly to a merchant cash advance. Additionally, their SaaS runway loan offers a business line of credit specifically for SaaS companies, with future sales determining the credit limit.
