What is velocity capital?
This is a type of funding that allows mobile game studios that have games generating revenues to borrow against those revenues in order to utilise the revenues they have earned before they are paid out by the App Store.
How can velocity capital benefit your studio?
Velocity capital is a cash flow tool which means you will only have to wait 7 days or less instead of 30 to 60 days to receive the revenues earned from your mobile game.
Certain providers also offer other services such as advice on a studio’s user acquisition strategy, which may be an additional benefit.
How does it work?
As the typical App Store payment terms are 30 to 60 days, velocity capital providers will verify the revenue data produced by a mobile game and pay out to the owner of that game within a shorter period (usually within 7 days). The payment usually takes the form of a loan. The game revenues, once paid out by the App Store, will be used to repay the loan.
What are the key terms of the funding?
Typically, the velocity capital provider will often charge a fixed fee of around 5% (this rate may vary) of the revenues to be paid by the App Store.