The State of Washington Launches a Revenue Based Financing Business

The State of Washington is getting in to the revenue based financing business. Coinciding with Broker Fair 2025 on May 19th, the Washington State Department of Commerce announced it was launching the Revenue-Based Financing Fund (RBF) loan program for small businesses. Its administered by Grow America.

“This is one of the most innovative loan programs we’ve ever launched,” said Commerce Director Joe Nguyễn. “It’s not a typical business loan. It’s a Pay-As-You-Earn loan that works with the reality of running a small business. Instead of fixed monthly payments, businesses repay based on what they actually make. So if sales slow down, payments stay low. If business picks up, payments adjust. It’s flexible, it’s fair, and it’s the kind of practical solution we need to support small businesses across Washington.”

$13M in funding has been allocated to this program so far. Funding works similar to a business loan from Square or PayPal where there is technically a term and minimum monthly payment required, but the repayment system is based on a percentage of sales, namely 20% of them.

“At Grow America, we’re excited to launch the Washington Revenue-Based Financing Fund,” said Daniel Marsh III, Grow America president. “This program offers flexible capital, empowering Washington’s small businesses, especially entrepreneurs, to scale operations and achieve sustainable success.”

“Revenue-based financing provides you with flexible upfront capital, and its payback terms are customized to your cash flow and fluctuate based on your revenue,” the marketing materials state. “It’s ideal for small businesses that are seasonal, may not have a consistent income, or require an alternative to a traditional loan.”

Getting Backdoored? Put Your Mark on the Docs

Christina Duncan was once working on a renewal as an MCA broker when things turned south. Her client suddenly received so many calls with offers for funding that they had to turn their phone off.

“[The client] eventually reached out to us via email and basically said, ‘Hey I don’t know what’s going on but these people are saying they’re with you and they have my bank statements. I’m really concerned,'” Duncan said.

Christina Duncan, Founder, Aquamark

Duncan’s renewal had been backdoored. It was hardly the first time, and she was hardly the only victim. As many in the industry often complain, it has become a growing trend in which a broker submits a client’s deal and it somehow slips out the back door into the hands of a third party. The broker then ends up competing on their own deal, or they lose out on it completely. And that’s how many brokers see it—​as something that happened to them. But there’s also the business owner who is now left wondering how their data ended up in the wrong hands and what to do about it.

In the above example, Duncan tried to help the client learn how an unauthorized party came into possession of those bank statements, but she was simply hung up on and blocked. It was a dead end.

“So those are the situations that we encounter every day and it’s tough to navigate,” she said.

Born in San Jose, CA and based in San Francisco, Duncan has seen it all. She started in equipment financing more than 15 years ago and gradually shifted into brokering MCAs. When complaints about backdooring began to crop up, everyone had their own opinion on the cause.

“I’ve seen people get caught up on just trying to point the finger or use backdooring as an excuse for their lack of success,” Duncan said, “But the reality is that it is very real. I’m a part of the DailyFunder forum. I see people talking about it all the time but there just hasn’t really been an efficient way to deal with it.”

But then she came up with a solution: Aquamark, a defensive watermarking tool that differs from other tactics employed across the industry to reduce the risk of backdooring. It allows brokers to permanently stamp the documents as having originated from them.

With the assistance of AI and a small team, Duncan left the broker world behind to go full-time into developing the technology, which she said can be used on all the documents in the process.

“It’s not just the bank statements, it’s tax returns, your application,” Duncan said. “What’s happening is it’s someone who has access to these submissions, these packages, and it very well could be internal, someone on your team, it could be a lender and the lender doesn’t know that…”

So it’s not only a problem, but one that can happen at multiple levels in the process. The Aquamark tool, still in its early days but already being used by funders and brokers, can apply custom-branded watermarks onto PDF files with ease. On the one hand, she said, the tool had to be designed to prevent AI from removing the watermarks, and on the other hand it had to work with encrypted statements. When she solved both challenges, she knew she had something. Now, brokers simply upload their documents through the portal, and the platform returns them in seconds.

“By design, I built this in a way that it’s very lightweight and it’s self-service,” Duncan said. “You don’t really need me to do anything and more importantly we’re not storing anything. So essentially you’re uploading your documents and I’m giving it back to you. There’s no logs, there’s no history, none of that is happening behind the scenes.”

The company’s mission statement is a simple one: “Prevent Backdooring. Fund More Deals.”

As Duncan explains, lenders might not even know that a deal they’ve received has been backdoored because the submitting party doesn’t always make it obvious where they got it.

“It’s tough, especially in this environment with all the competition, cost to acquire customers are through the roof, and you lose that,” she said. “It sucks. And honestly it’s so frustrating because aside from it being [how brokers make their money], for the merchants it puts that bad taste in their mouth in the industry. And it’s very real. And so I just wanted to come out with something that—again, the MCA industry gave me a lot and this just feels like a way to give back, as cheesy as that sounds.”