What are the differences between term notes and revenue sharing notes on NextSeed?
Debt Instrument Return on Investment Monthly Payments Benefits Risks Term Note Annualized Interest Rate
Fixed - Same amount paid per month. Payments required whether or not revenue is generated.
Consistent and predictable payments with set interest rate. Early repayment: if the business pays back the investment principal in full early, you will receive less total interest than expected over the life of the investment. Revenue Sharing Note Set multiple on investment principal. Rate of return depends on how quickly a business makes its payments, and how much is paid each month. Varied – Amount varies based on the business’s revenue generated each month (determined by a set revenue sharing percentage). Payments only required when revenue is generated. If a business does well, the investor will be paid back faster and therefore earn a higher return.
If a business does not open, no payments are due until maturity.Early repayment: some investments offer a lower investment multiple if the business pays early.