Despite capital importance, SMEs face a great challenge securing conventional financing, due to the credit requirements which include collateral requirement demanded by financial institutions.

We will explore revenue-based financing, and a snapshot of an entrepreneur PES has supported secure revenue-based financing in partnership with UNCAP.

Revenue Based Financing is an alternative investment structure with different mechanics, provisions, and return profiles than either straight equity capital or traditional lending products. The money invested is repaid as a percentage of future revenues.

Like any other funding option revenue-based financing has its pros and cons.

Pros and Cons of Revenue Based Financing

The benefits of revenue-based financing are:

  • Revenue-based financing is significantly cheaper than alternatives. i.e, equity Angel investors and venture capitalists usually expect 10 – 20 times return on investment (ROI).
  • Payment’s flexibility – the monthly repayments are based on future revenues inflow.
  • No collateral or guarantee of the loan unlike banks require guarantee of the loan issued.

The drawbacks of this form of financing are:

  • Revenue is a key thing. The business must earn revenue, to use this financing option.
  • Monthly payments are necessary
  • This alternative form of financing has minimal regulation, one must do careful research before entering any agreement, to protect their interests and rights.

PES aided one of their clienteles, Rico Amor Ltd. secure Revenue Based Financing.

Rico Amor is a Private Limited Company, that majors in the processing of dairy and lactose free products, the Rico Yogurt. The Yogurts main constituent is coconut from the Kenyan coast. In addition, it also indulges in renewable energy sector by manufacturing of charcoal briquettes.

Rico Amor Ltd. was incorporated in 2019, to provide premium coconut products while pricing them competitively as they offer their customer quality. Rico Amor products are organic, and plant based hence safe for the lactose intolerant (70% of world’s population lies). There is a huge niche in Kenya as this subsector, coconut products, earns KES. 12B revenue annually, which is barely a quarter of its potential. Coconut Farming has potential to pump in KES. 13 – 25B.

Private Equity Support (PES) has worked with the CEO of Rico Amor in the capital raising process to expand his business. The support involved, improving the investor marketing materials, sourcing investors and during deal execution.


Rico Amor successfully secured Revenue Based financing from UNCAP. His one of the successfully applied youth-led agripreneurs. 



Sector: Agribusiness

Project Description

Gerald Munene, a WIDU beneficiary based in Olkalau, Nyandarua County, is an entrepreneur in the business of seedlings. The entrepreneur by greenhouse farming, optimizes growing conditions and protects the seeding growth from extreme weather conditions. Consequently, addressing the insatiable appetite locally as well as creating employment opportunities within Nyandarua county.


Through the joint investment [both from the entrepreneur, and the donor], he was able to set up 12 m by 5 m greenhouse structure while the WIDU grant funded the nursery with modern trays, purchase inputs, drip irrigation system, supply seeds and sales office.

The PES WIDU coach supported Gerald in how best to understand his business model, aligning operations, marketing strategy and conducting a transparent and sustainable business.

Result: –

  • Seven youths employed [5 females, 2 males].
  • Established a profitable, and environmentally friendly business that embraces innovative farming practices.
greenhouse farming


Empower is an immersive online course for entrepreneurs to upskill their decision-making, business numbers and leadership capabilities.

Private Equity Support Limited in partnership with the Michigan Academy for Developing Entrepreneurs (MADE) will over the course of 5 days, engage virtually with #SME business owners and management, to facilitate the ‘Empower Business Leadership Program’ from 24th August to 21st September 2022.

This is a virtual program spread over five [5] weeks covering one topic each week bringing together entrepreneurs, industry practitioners to undertake a deep dive into business leadership. The overall key insights from in depth presentations, investor panel discussions, practical case studies, practitioner insights and networking sessions are:

  • Understanding the business environment and strategies to tackle it.
  • Solving employee problems using GATE Framework.
  • Knowing your business wealth, personal wealth & valuation.
  • Grasping the basics of the financial statements.
  • Improving the business processes by making continuous learning as the DNA of your company.

This is against a background of great uncertainty created by the COVID 19 pandemic, geopolitical shifts, and strained economic growth.

Sessions will take place between 1130 hrs. to 1330 hrs. [East Africa time]. To register click this link.