Lighter Capital Review

Pros

• Suited for small businesses
• Competitive terms and fees
• Excellent customer support

Cons

• Funds can take a while to disburse
• Only suitable for software, SaaS, tech services, & similar sectors

What Is Lighter Capital?

Lighter Capital offers non-dilutive financing to eligible businesses in the tech industry, including software, SaaS, tech services, and businesses in similar sectors. To repay the loan, Lighter Capital offers three different types of funding: revenue-based, term-based, and contract-based.

Additionally, Lighter Capital may be able to help your business grow in other ways. The company has an active community program with which you may be able to connect with peers, venture capitalists, and other people who can help your business grow.

Services Offered

Lighter Capital offers three different types of non-dilutive funding:

• Revenue-based: Loans based on monthly recurring revenue
• Term-based: A more traditional loan structure with fixed monthly payments
• Contract-based: Loans based on short-term contracted revenue sources

Lighter Capital doesn’t have the variety of funding options available through other online lenders, which negatively impacted our rating. The lack of a mobile app also lowered the rating, bringing it to a 3.5/5 for services offered.

Borrower Qualifications

To qualify for a Lighter Capital loan, you must meet these requirements:

• You have a headquarters, branch, or subsidiary in the US, Canada, or Australia
• You generate at least $200K in annual recurring revenue (ARR) or $15K in monthly recurring revenue (MRR)
• You have multiple sources of revenue
• Your business is in software, tech services, SaaS, or a similar sector

There are no listed time in business or credit score requirements. Lighter Capital does disclose that eligibility and approval are subject to standard credit assessment and that not all applicants may qualify. Not having strict limits on these requirements helped raise our rating for Lighter Capital’s eligibility requirements.

The company also states that your business does not have to be profitable or have positive cash flow, provided you meet the annual or monthly recurring revenue requirement. The revenue requirements are a bit steep, and only certain types of industries qualify, which lowered our score in this area to a respectable 4.2/5.

Rates & Fees

Unfortunately, Lighter Capital does not disclose much information about its terms and fees. It does provide a basic overview and a few details about some products to help you get an understanding of what to expect before applying. This lack of transparency led to our rating of 4/5 for Lighter Capital’s rates and fees.

Application Process

To get started with Lighter Capital, you’ll need to submit the online application. The lender states this application should take around three minutes.

After submitting your application, you’ll be contacted by one of Lighter Capital’s investment advisors to discuss why you need funding, borrowing requirements, and other details. You’ll also share your financial details to determine what product you qualify for, how much you are eligible to borrow, and additional requirements to receive funding.

If approved, you’ll receive the details of your loan, including repayment terms and when your loan will be funded.

Lighter Capital states that the process takes approximately three to four weeks for new clients. Loans are typically funded just a few days following loan approval. The length of the application process did negatively affect our score for Light Capital, bringing it to a 4/5 in this area.

Sales & Advertising Transparency

Lighter Capital provides a good amount of information to help businesses decide whether or not this is the right service for their business. After perusing the site, you should have a good sense of the lender’s products, how the application process works, eligibility requirements, and general guidelines for terms, borrowing limits, and other details.

The company also has a somewhat active social media presence, which was taken into consideration in calculating our score of 4.2/5 for Lighter Capital’s sales and advertising transparency.

Customer Service & Technical Support

If you need to speak to a representative from the company, customer service is available via phone or email. Lighter Capital has a comprehensive FAQ that supplies answers to basic questions borrowers might have about the service.

Lighter Capital also has profiles on Facebook, Instagram, LinkedIn, and X.

In my experience, the staff is responsive, knowledgeable, and willing to answer questions. However, as no reviews online address customer service specifically, I cannot say if my experience is standard.

Lighter Capital also lacks some of the customer support and self-service options you’d find with other lenders. There is no live chat option, no knowledgebase, and you don’t have a dedicated support rep (or at least this is not disclosed. For these reasons, Lighter Capital received a 2.7/5 for customer service and technical support.

User Reviews

Lighter Capital has a profile on the Better Business Bureau website with an A+ rating (though it is not currently accredited) and no negative reviews or complaints. Otherwise, the service has very few customer reviews online, but has been extensively covered in news and business publications on the web. The positive testimonials, handful of positive reviews, and overall user feedback on review sites contributed to Lighter Capital’s near-perfect 4.9/5 rating.

Negative Reviews & Complaints

Here are a few reasons Lighter Capital may not work for your business:

• Niche Lender: Lighter Capital is not for every business and only works with businesses in a handful of industries.
• Long Time To Funding: The timeline from filling out an application to receiving funds could take up to one month, which isn’t ideal for businesses that need quick access to capital.
• Must Repay Loans Immediately: Borrowers must start repaying their debt immediately. The need to make repayments may force business owners to prioritize revenue over other metrics.

Positive Reviews & Testimonials

Lighter Capital has a few high-rated reviews on Facebook and Google; however, none of the reviewers left comments. The company has also recently been featured by several media outlets, including TechCrunch, The Huffington Post, NASDAQ, and Forbes.

Additionally, the company has a few customer testimonials on its blog, and you can see other businesses Lighter Capital has worked with on its clients page.

Here are commonly cited reasons people like Lighter Capital:

• Doesn’t require equity
• Repayments fluctuate with cash flow
• Collateral not required

Final Verdict

Lighter Capital services a very specific type of business, but it’s worth considering if you qualify.

Because Lighter Capital strictly works with businesses in the tech industry, eligible businesses would benefit from working with a lender that understands their business. Ultimately, Lighter Capital is a viable alternative to VC funding or bank loans, especially if you are not interested in giving up equity or don’t have any collateral.

For these reasons, we gave Lighter Capital an overall score of 3.8/5 and recommend this lender to businesses in the tech industry that meet the lender’s borrowing requirements.

Business Loan & Funding Products Review Methodology

Merchant Maverick has been researching and reviewing business lenders since 2015. Our writers have tested over a hundred different funding products, including traditional term loans, online loans, lines of credit, start-up loans, merchant cash advances, and equipment financing. In each review, we evaluate rates and fees, services, eligibility requirements, application process, sales and advertising transparency, customer service, and user reviews.

Read more about how we rate business loans and funding products.

When comparing different lenders and loan products, we consider many data points, including the ease and transparency of the application process, interest rates, repayment structure, sales ethics, time to funding, revenue and time in business qualifications, and credit score requirements. Our lists of the best funding products include only those we’ve deemed worthwhile from multiple vantage points, and often share qualities such as widespread accessibility across fifty states, low rates, flexible requirements, and competitive borrowing amounts.

We spend an average of 10-15 hours researching and updating each one of our lists, making sure the loans and funding products included meet our internal standards for quality and reputation.

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