Why Revenue Based Loans Don’t Work to Scale Mobile Games

How Do Revenue Based Loans Work?

Do They Work For Scaling F2P Games?

  1. The cash offset automatically pushes the cash received two months to the right, meaning that the first couple of loan repayments must be funded by an alternative source (existing cohorts, equity etc.)
  2. When the LTV generated (as net cashflow) is compared against the repayment schedule of the loan, we see that the revenue based loan is expected to be fully repaid by the time that just ~66% of the customer acquisition cost has been recovered.

What Happens If I Want To Keep Scaling?

Let’s Talk About Interest

What Happens If Things Go Wrong?

What’s A Better Alternative?

Conclusion

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