Total annualized value of subscription contracts. The primary underwriting metric for SaaS debt instruments.
The ratio of loan value to ARR. Typically 3x–7x for institutional SaaS debt.
The multiple of qualifying ARR a lender will advance as a loan facility. Typical range is 30–60% of ARR for institutional lenders and 70–95% of ACV for fintech ARR platforms. Determined by NRR, churn rate, and logo concentration.
Short-term capital deployed to cover operational gaps. Repaid upon next capital event.
Net cash outflow per month. Indicates capital consumption velocity.
The hierarchy of debt and equity financing. Senior debt sits above mezzanine and equity.
Speed at which capital can be accessed and deployed. Measured in hours.
Percentage of ARR lost per period. Critical underwriting variable for SaaS debt.
Asset pledged as security for a loan. Liquidated upon default.
Contractual restriction imposed by a lender. May include minimum ARR or cash balances.
Total outstanding debt divided by ARR. Measures leverage intensity.
Operating cash flow divided by total debt service (principal + interest) for a given period. Most ARR lenders require a trailing-12-month DSCR of 1.2x–1.5x minimum. A DSCR above 2.0x typically unlocks premium advance rates and covenant flexibility.
Reduction in existing shareholder ownership percentage. Occurs when new equity is issued.
Non-physical asset with economic value. Includes software IP, patents, and brand.
Using intellectual property as security for a loan. Requires formal valuation.
Acquisition financed primarily with debt. Target company's assets serve as collateral.
The percentage of customer accounts (logos) retained from one period to the next, independent of revenue value. ARR lenders use logo retention alongside revenue retention to assess customer concentration risk and portfolio durability. Most institutional lenders require logo retention above 80% annually.
Monthly subscription revenue. Multiplied by 12 to derive ARR.
ARR retention including expansions, minus churn and contractions. >100% is institutional.
Financing that does not require issuing equity or warrants. Founders retain full ownership.
Round Rock Requisition's internal scoring framework. Assesses ARR, NRR, and burn rate against institutional debt criteria.
Selling future recurring revenue at a discount for immediate capital. No equity exchange.
Months of operating capital remaining at current burn rate. Calculated: Cash ÷ Monthly Burn.
First institutional venture capital round. Typically $3M–$15M for SaaS.
The section of the Uniform Commercial Code governing security interests in personal property, including accounts receivable and software IP. ARR lenders perfect their lien on a borrower's recurring revenue stream by filing a UCC-1 financing statement. Texas operators are subject to UCC Article 9 as adopted under the Texas Business & Commerce Code.
The process of evaluating borrower creditworthiness before issuing capital.
Debt financing structured for venture-backed companies. Typically requires warrants.
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Access non-dilutive capital for your McKinney SaaS.
72-hour deployment. No equity exchange. Institutional terms.