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By Travis Yule — CEO & Founder, Full Send Funding
Published 2023-04-14 · Updated 2026-09-30
A seasonal business does not have a typical month — it has two businesses sharing a bank account. Apply on peak statements, and size the remittance against the trough.
In one sentence: A seasonal business has no clean four-month window — every one either carries the trough, which sizes the offer down to it, or the fall off the peak, which reads as decline — so the document that decides the file is last year's same four months, and the lever that fixes the structure is term length, not amount.
Seasonal businesses get funding wrong in a specific, predictable sequence: they apply in the off-season when cash is thin, get priced on their worst statements, and then carry a full-strength remittance into the months with no revenue. Every one of those three is avoidable: the first by timing, the second by a document, and the third by term length.
The underlying problem is that most funding is sized against a monthly average, and a seasonal business does not have a typical month. It has two businesses that share a bank account.
What follows is the mechanism in the order it happens inside a file: which four months underwriting reads, what it does with the weakest one, and which lever actually fixes the structure. One illustrative year runs through all of it, so every number can be checked.
Underwriting reads your last four months of deposits. That window is the application — what an underwriter derives from those statements is deposit volume and its shape, the average daily balance, negative days, existing positions and the slope of the revenue. For a business with a flat year, four months is a fair sample of twelve. For a seasonal business it is not a sample at all — it is a snapshot of one part of a shape.
Take an illustrative landscaping year, and hold these numbers, because the rest of this article uses them. Three trough months at $21,000 of deposits (December, January, February), one shoulder month at $41,000 (March), a spring and early-summer peak of $100,000 a month (April, May, June), and $41,000 a month from July through November. That is $609,000 for the year and $50,750 a month on average, with a peak just under five times the trough. Landscaping is the archetype, but a seasonal hotel or motel, a ski operation, a fireworks retailer, a tax practice, a summer camp and a Gulf Coast marina all have the same shape in different months.
Now place the window on it.
Deposits of $21,000, $41,000, $100,000 and $100,000: $262,000 in total, an average of $65,500 a month. The trend rises steeply and the most recent month is the strongest of the year, which is the best thing a window can do for a file, because the recent months carry the weight and a rising slope is read favourably.
But the weakest month in it is $21,000, which is 32% of the $65,500 window average. A remittance is sized against the weakest normal month rather than the average, and when the weakest month sits that far below the average that is what happens. On the published sizing rule of 80% to 150% of monthly revenue, sizing to $21,000 gives an offer of $16,800 to $31,500 — against the $52,400 to $98,250 the same window's average would have supported.
Deposits of $100,000, $41,000, $41,000 and $41,000: $223,000 in total, an average of $55,750, and no trough month in it at all. The weakest month is 74% of the average, comfortably inside the point where the average is used rather than the floor.
But the window falls 59% from its first month to its last, and falling revenue is one of the reasons a file is declined on capacity rather than sized down. A window running from a peak month down to a shoulder month is arithmetically indistinguishable from a business losing its customers.
Every four-month slice of a seasonal year either contains the trough, in which case the offer is sized to the trough, or contains the fall off the peak, in which case it reads as decline. Choosing between them is choosing which defect you would rather explain, and Window A is usually the better half of that trade: a rising slope ending on your strongest month is worth something, and a trough month has a name you can say out loud. One practical consequence: put a recurring reminder six to eight weeks before your peak ends, for money you will need four months later, while the statements are strongest. But the choice of window is not the fix. The fix is a document.
Our document ask is four months of business bank statements. Nothing below is required — it is volunteered, and it is the highest-return thing a seasonal applicant can put in front of an underwriter.
Send last year's statements for the same four calendar months alongside this year's. It does two things that no amount of explanation does on its own.
It converts volatility into seasonality. A weakest month at 32% of the window average is a sizing problem when it stands alone, because the underwriter has to assume the next $21,000 month could arrive without warning and size the remittance to survive it. Set last February beside this February and the $21,000 sits on a date rather than in a range. If last February was $19,000 and this February is $21,000, the file stops being a business with an unexplained collapse in it and becomes a business whose weakest month grew 10.5% year over year.
It gives a like-for-like comparison where the window cannot. Month over month, June to September falls 59% and reads as decline. Year over year on the same calendar months, the identical numbers are a season closing on schedule.
What changes as a result is usually not the price. It is the question being asked. Without the prior year, the question is how small does this have to be to survive the weakest month, and the answer on the illustrative file is $16,800 to $31,500. With it, the question becomes how long does this have to be so the remittance survives the weakest month, and the amount can be read off the window average — $52,400 to $98,250 on exactly the same four statements. Roughly three times the offer, for a document already sitting in a folder.
Two smaller things travel with it and both are free: a short written note on the shape of the year saying which months are the season, which are the trough and why, and payoff figures for any position you intend to retire out of the proceeds. Explained, the shape is a fact about the business. Unexplained, it is risk, and risk is either priced or declined.
Whatever you qualify for, the payment has to clear in your slowest month — because it will still be debiting then.
This is where seasonal deals go wrong even when the amount was right: a remittance that is a comfortable share of peak revenue can be an impossible share of trough revenue.
Nothing about the debit changes when the season does. A remittance that was a comfortable share of peak revenue at signing becomes an impossible share of trough revenue four months later, with nothing having gone wrong.
Illustrative: a fixed remittance of about $2,077 a week — $9,000 a month — against a $100,000 peak month, a $41,000 shoulder month and a $21,000 trough month, so the peak is just under five times the trough. Run your own worst month before signing.
The same weekly remittance that takes 9% of a peak month takes 43% of a trough month. It was affordable when it was signed and unaffordable four months later, without anything going wrong.
It is worth seeing which deal that chart is. It holds a fixed remittance of about $9,000 a month, and a $90,000 advance at a 1.20 factor pays back $108,000, which over twelve months is $9,000 a month. That is 20% cost of capital and an entirely ordinary offer — 137% of this business's $65,500 window average, inside the published 80% to 150% band, on a file nobody would call aggressive. It simply cannot be paid in February, where it is 43% of deposits — far more than a file's deposits can carry.
So run the payment against your worst historical month before signing, not your average month. If it does not fit there, take a smaller amount or a longer term.
Two working ratios decide most files, and neither of them appears on a term sheet.
The first is the remittance share: every recurring debit to a funder, including the one being proposed, set against deposits. A heavy share gets a file sized down and priced for it, and a share the deposits cannot carry is declined. The second is days of cover: the average daily balance divided by the combined daily remittance, which is how many banking days the account could carry the debits with nothing at all coming in. A thin cushion sizes the offer down, and an account with almost none is usually declined. Neither has a published cut-off; as The 14 Real Reasons Applications Get Declined explains, each is judged against the rest of the file.
Here is what matters for a seasonal business: both are computed on the window, and the window is a season.
Take the same landscaper funded at $65,500 on a twelve-month structure at a 1.20 factor. The payback is $78,600, which over 52 weekly remittances is $1,511.54 a week, or $6,550 a month. Against the $65,500 window average that is a remittance share of 10.0%. Against a $100,000 peak month it is 6.6% and effectively invisible. Against the $21,000 February the debit will actually be running in, it is 31.2% — more than those deposits can carry.
Days of cover does the same thing with the balance. Spread over five banking days, $1,511.54 a week is $302.31 a day. On a window average daily balance of $14,000 — illustrative, and the kind of balance a spring peak leaves behind — that is 46 days of cover, an excellent file. On an equally illustrative February balance of $2,500, the same debit gives 8.3 days, a thin cushion for the month the business is weakest.
Neither number is wrong. Both are averages of a quantity that has no meaningful average, and the file passes on the window's version and fails on February's — and February is the only one of the two the debit has to survive.
The second thing a funder sees is about what happens after funding. A funder who has been told February is coming can plan for it: the reconciliation gets used, the short month is a scheduled event, and the file stays in good standing throughout. A funder who has not been told sees a remittance return in the first week of February and reads it as the first sign of a deteriorating deal. That changes the posture of everybody involved — collection calls, a hold on the renewal, a harder conversation in April when you want next season's money. Disclosure is not only a pricing input. It is the difference between a slow month that was expected and a slow month that was discovered.
Once the amount is right, the only thing left that moves the trough burden is time.
On an advance the payback amount is fixed at signing, so stretching the term of a deal you already hold does not increase what you owe — it changes only how hard the remittance presses on each week's cash. At the term sheet it is different: term length is priced. Our cost of capital runs from 4.5% to 45% depending on qualifications and term length, and a longer structure sits further up that range. Choosing a longer term is a genuine trade rather than a free option, and the seasonal question is whether the trade is worth making.
Run it on the same $65,500.
Twelve months at a 1.20 factor. Payback $78,600, a dollar cost of $13,100, which is 20% cost of capital. The remittance is $1,511.54 a week, or $6,550 a month. Against February's $21,000 that is 31.2%.
Twenty-four months at a 1.38 factor. Payback $90,390, a dollar cost of $24,890, which is 38% cost of capital. The remittance is $869.13 a week, or $3,766.25 a month. Against February's $21,000 that is 17.9%, a share the trough can carry, and days of cover on the same $2,500 February balance rises from 8.3 to 14.4.
The longer structure costs $11,790 more, which is 90% more in dollars. That is a real number and it should not be waved away. Set it against what the shorter structure actually does in February, though: a 31.2% remittance share in a month that still has to cover payroll, insurance and rent. If the twelve-month deal fails there, its true cost is the returned-item fees, the negative days that then poison the next four-month window, and — most expensively — the second position taken to cover the first.
Because the cost is a total on the amount funded rather than an annual rate, this arithmetic does not behave the way borrowers expect. Doubling the term did not double the cost. It raised the dollar cost by 90% while cutting the monthly burden by 42.5%. Why a factor rate and an interest rate are not comparable numbers is worth reading before judging either offer, because an annualised view flatters the shorter deal and the dollar view flatters neither.
The test is not which offer is cheaper. It is which offer's remittance clears in February with room. If both clear, take the cheaper one — on a business that can carry the shorter structure, the longer one is money thrown away. If only one clears, the cheaper offer is not an offer. Running two structures side by side on payback and monthly burden takes five minutes. Whether the debit lands daily or weekly is a separate and much smaller question, though a weekly debit placed the day after your largest deposits is worth asking for.
A fixed remittance and a variable year are in direct tension, and reconciliation is the clause that resolves it: the right to have the remittance adjusted when actual revenue falls short of the estimate it was sized against. For a seasonal business it is not a nice-to-have but the mechanism that makes the structure work.
Ask about it explicitly, and ask before you ask about the rate. Three things decide whether the right is real rather than decorative: whether it is available on request or only at the funder's discretion, what you must produce and how long the funder has to act on it, and whether a correctly reconciled slow period counts as a default. It should not. The clause-by-clause reading of an advance agreement covers the wording to look for.
On our own paper, on deals up to $2 million: we file no UCC-1 lien against the business, and there is no confession of judgment in our agreements.
Four shapes, four different answers.
Pre-season ramp. Inventory, hiring, equipment and marketing ahead of revenue; a liquor store buying its holiday stock in September is the textbook case. This is the classic seasonal need and the best-behaved one, because the repayment lands during the peak. Structure it to pay down heavily while revenue is arriving, and size it so the tail that survives into the off-season is small enough to clear in the trough.
Off-season bridge. Carrying staff, rent and insurance through the trough to protect the crew you will need in April. Smaller, longer, and sized against trough revenue rather than annual revenue. Working capital loans fit this shape.
Revenue that swings but never stops. A restaurant in a beach town, a contractor whose winter is thinner rather than absent, a gym whose summer runs slower than its January. Revenue-based financing with a genuine reconciliation right is built for this, because the remittance can be adjusted when the revenue it was sized against does not arrive.
A year that empties the balance and refills it. A line of credit is structurally the most natural seasonal instrument there is — draw for the ramp, repay through the peak, redraw next season. Our own is a flex line from $10,000 to $2 million, on which each draw is priced as its own advance; a line priced on the drawn balance is arranged with a direct lending partner, only if you choose to and at no fee to you. It is also the harder facility to qualify for, and a line carried near its limit all year is not cheaper than a term structure; the saving exists only if the balance genuinely falls during the peak. The comparison of a line against a term facility works the crossover arithmetic.
One thing belongs in none of them: the machine. A mower fleet or a second oven bought ahead of the season usually should not come out of working capital, because the asset outlives the season by years. Equipment financing, which we arrange through a direct lending partner, lets the equipment itself carry part of the risk, and its term matches the asset rather than the year.
Wrong twice over, and it is the most common instinct. A peak-adjacent window either still holds the trough, in which case the offer is sized to it and the peak months did not help, or it holds the fall off the peak, in which case it reads as a business in decline.
The cheaper offer is correct only if its remittance clears your worst month; on the worked file, $11,790 of extra cost buys a fall from 31.2% to 17.9% of the trough month. The exception is real, though: an operator who reliably banks part of the peak can carry the shorter structure and should, and the longer term is then pure waste.
Often the right answer is to carry less of it. Money held back during the season costs nothing, and it does something funding cannot: it raises the average daily balance, which is the figure that most often sets the size of an offer. An operator who banks part of the peak both needs less funding and qualifies for more of what they do need. The case for borrowing instead is an off-season cost that cannot wait — a crew you will lose, a lease, an inventory position bought at a discount — or a ramp larger than one season's retained cash can fund. Where the trough is structural rather than seasonal, debt is the wrong tool entirely.
This is the worst available move and it is the most common one, because the offers arrive precisely when the account looks thinnest. A second remittance against the same unchanged revenue is the trap that does the most damage in this industry. The correct sequence is reconciliation first, a call to the funder second, and a renewal at the next peak third. If a remittance is genuinely going to fail, the call before it fails is worth far more than the call after it.
There is no better window. A tax practice whose season is January to April, or a fireworks retailer whose year happens in two weeks, has no four-month slice that is majority in-season. Those files are underwritten on the shape rather than the level: apply as the season closes, when the window holds as much of it as the calendar allows, and lead with the prior year. Note the interaction with our floor too. A business four months old in the middle of its season clears both the time-in-business and the revenue bar comfortably; the same business in its trough may not clear the revenue floor at all, which is a fact about timing rather than about the business.
Seasonal operators think about the season. Underwriting thinks about the twelve months, and so should the borrower.
Build a month-by-month cash model for the whole year: revenue in, costs out, how deep the trough goes, the date it bottoms, and what the balance is on the worst day. Most seasonal owners carry a version of this in their heads and have never written it down, and writing it down changes decisions, because memory systematically overstates the trough — you remember the busy weeks in a quiet month.
The model does three things. It tells you how much you actually need rather than how much you can get; sizing runs 80% to 150% of monthly revenue, and the top of that band is not a target. It gives you the worst-month figure to test a proposed remittance against. And it is persuasive in an underwriting call, because very few applicants bring one and an underwriter handed one is reading the business rather than inferring it.
The thirteen-week version of this discipline is the standard tool for running the quarter you are in, but a seasonal trough is usually further out than thirteen weeks, so the sizing model has to run twelve. The general capital calculation — daily operating outflow multiplied by the cash conversion cycle — still applies; it simply has to be done month by month, because the average is a fiction.
Seasonal operators tend to end up liking the renewal model, because it matches the shape of the business: fund the ramp, repay through the peak, renew at the next season with a completed cycle behind you.
That first clean cycle is worth more than the terms on the first deal. From the other side of the table, a seasonal business that has completed one is a more predictable file than a flat business with the same numbers: the shape can be planned around, and the next request arrives on a date you could have guessed.
Two mechanics to check before agreeing to one. The outstanding balance of the old advance is rolled into the new one, so the figure that decides whether a renewal is worth taking is what actually lands in the account after the old position is retired, not the face amount of the new deal. And unless the agreement carries a prepayment discount, retiring the old position early through a renewal saves nothing, because the unearned part of the original factor does not come back. How renewals actually work has that arithmetic in full.
How deep your trough actually is. Only your own statements answer that, and most owners get it wrong in the same direction. Pull the twelve months and read the number rather than remembering it.
Whether your season is a season or a decline. Two or three consecutive years of the same shape is evidence; one year is not. Your booking pipeline, your renewal rates and what is happening in your market answer that question, and your bank statements do not.
What your own numbers will be. No cut-off is quoted here, because none is published: the remittance share, the days of cover and how far the weakest month sits below the average are each judged against the rest of the file, and the percentages above are arithmetic on this example rather than lines to engineer to.
The tax and entity questions. Whether to hold the peak's cash inside the business or take it out is your accountant's question. Whether a specific agreement's reconciliation clause says what you think it says is one for your own attorney, and it is worth the hour before signing rather than after.
Four months in business and $10,000 a month in average revenue — averaged across the window, which smooths a slow month or two. We fund $5,000 to $10 million in working capital, with a decision within 24 business hours and, on deals up to $2 million, funding within 24 hours of approval, 1 to 3 business days end to end, and same-day funding is possible on a clean file submitted before 2pm ET, so a mid-season opportunity is still fundable while it is still an opportunity. Terms run from four months to three years, which exists precisely so that a season's borrowing does not have to be repaid inside the season. Checking your options is a soft credit pull only.
See what your business pre-qualifies for, or read how an offer gets sized before you apply.
The burden chart holds a fixed remittance of about $2,077 a week — $9,000 a month — against a $100,000 peak month, a $41,000 shoulder month and a $21,000 trough month, so the shares are 9%, 22% and 43%; the site's arithmetic audit recomputes them before publication. The months are illustrative, and a business should run its own worst month. The timing advice is the firm's underwriting practice with seasonal applicants.
The worked file is arithmetic on stated inputs rather than a quoted deal: a $65,500 window average, a twelve-month structure at a 1.20 factor and a twenty-four-month structure at a 1.38 factor, both inside the published 4.5% to 45% cost-of-capital band, with the remittance share and days-of-cover figures computed from those and from two illustrative average daily balances of $14,000 and $2,500. The readings beside those figures are qualitative, because the firm publishes no cut-off for either test; The 14 Real Reasons Applications Get Declined explains why.
With a document first and timing second. The $10,000 monthly minimum is read as an average across four months of statements, so a slow month or two does not stop you qualifying. What a deep dip can change is size: when the weakest month in the four-month window falls far below the window's average, the remittance is sized to that month rather than to the average. Last year's statements for the same four months are what let the average stand. Timing helps too: a landscaper applying in June is judged mostly on peak months and qualifies for meaningfully more than the same company applying in November on the tail of the season, so arrange off-season capital while the season is still running.
Six to eight weeks before the peak ends, for money that will be needed four months later. That is when the statements are strongest, the trend is favourable and the average daily balance is healthy — and it is the difference between being priced as a strong business and being priced as a business that needs money. A recurring calendar reminder is the whole discipline.
One long enough that a season’s borrowing does not have to be repaid inside the season. Terms run from four months to three years for exactly this reason. The test is not what the shortest available term is — it is what remittance clears in your slowest month, since the debit will still be running then.
Against the worst historical month, not the average. Take the proposed weekly or daily remittance, multiply it out to a month, and set it beside your lowest-revenue month from last year. If it does not fit there comfortably, take a smaller amount or a longer term. A remittance that is 9% of a peak month can be over 40% of a trough month, and nothing about the debit changes when the season does.
Not as a warning sign. A seasonal dip with an explanation is not a decline — it is February at a landscaping company — and the $10,000 monthly minimum is read as an average across four months of statements, so a slow season does not stop you qualifying. What a deep dip can change is size: when the weakest month in the four-month window falls far below the window's average, the remittance is sized to that month rather than to the average. Last year's statements for the same four months are what let the average stand, so if your window catches the trough, say so in the application and send them.
It depends on the shape of the need. A pre-season ramp — inventory, hiring, equipment ahead of revenue — should be structured to pay down heavily during the peak, with only a small tail surviving into the off-season. An off-season bridge should be smaller and longer, sized against trough revenue. A business whose revenue swings but never stops is the natural fit for revenue-based financing with a genuine reconciliation right.
Because a fixed daily debit and a variable year are in tension, and reconciliation is what resolves it. Where the agreement grants it, the remittance can be adjusted when actual revenue falls short of the estimate it was sized against. For a seasonal operator that is the difference between a structure that survives the off-season and one that does not, so ask about it explicitly and check whether it is available on request or only at the funder’s discretion.
Enough to cover the modelled trough plus a margin, and no more. The way to know is a month-by-month cash model for the full year — revenue in, costs out, how deep the trough goes and when it bottoms. Most seasonal owners have never written it down, and doing so answers the question directly rather than borrowing what is offered.
Yes, and it is the highest-return thing a seasonal applicant can do. The document ask is four months of business bank statements; last year's statements for the same four calendar months are volunteered rather than required. They turn a weak month from an unexplained gap into a date that repeats, and they allow a year-over-year comparison on like-for-like months where a four-month window only offers month-over-month. Without them, a window containing the trough is sized against its weakest month. With them, the trough becomes a question about structure — how long the term has to be — rather than a reason to cut the amount.
Often, and the test is arithmetic rather than preference. On $65,500 funded, a twelve-month structure at a 1.20 factor pays back $78,600, which is $6,550 a month, or 31.2% of a $21,000 trough month. A twenty-four-month structure at a 1.38 factor pays back $90,390, which is $3,766.25 a month, or 17.9% of that same month. The longer structure costs $11,790 more. If the shorter remittance clears your worst month with room, take it and keep the difference. If it does not, the cheaper offer is not really an offer, because a failed remittance costs more than $11,790.
From four months of statements alone, often they cannot, and that is the whole problem. A window running from a peak month down to a shoulder month is arithmetically indistinguishable from a business losing customers. What separates them is the prior year on the same calendar months: a fall that repeats on the same dates is a season, and one appearing for the first time is a trend. Supply it, and add a short written note saying which months are your season and which are your trough. Explained, the shape is a fact about the business; unexplained, it is risk, and risk is either priced or declined.
Where the trough is shallow enough to cover, yes, for two reasons. Money set aside during the season costs nothing, and it raises the average daily balance, which is the figure that most often sets the size of an offer. So an operator who banks part of the peak both needs less funding and qualifies for more of what they do need. The case for borrowing instead is an off-season cost that cannot wait — a crew you will otherwise lose, a lease, an inventory position bought at a discount — or a pre-season ramp larger than one season's retained cash can fund.
Structurally it is the most natural fit: draw for the ramp, repay through the peak, redraw next season, with our flex line running from $10,000 to $2 million, each draw priced as its own advance, and an interest-bearing line arranged with a direct lending partner if you choose. It is also the harder facility to qualify for, and a line carried near its limit all year is not cheaper than a term structure — the saving only exists if the balance genuinely falls during the peak. So the question is not which product is better in the abstract but whether your year really does empty the balance. If the peak repays it, the line is the right instrument; if it does not, you are paying revolving pricing for term debt.
Travis Yule worked in business funding before starting Full Send Funding in 2021, and has more than five years in business funding in all. He leads the company from Middle Grove, New York, and writes about working capital from the underwriting side of the table — what the numbers actually have to say before a business gets funded.