Consumer brands have a working-capital problem that software companies do not: you pay for inventory months before a retailer pays you. Equity is an expensive way to finance a pallet of product. Non-dilutive capital is how most of that gap actually gets funded, and it is systematically under-covered because it makes worse headlines than a Series A.
Of the 201 rounds cpg.vc has read, a meaningful minority were not equity at all — term loans, revolvers, equipment finance, venture debt and one $1B customer-acquisition facility. Those are counted separately throughout the site, because a brand that drew on a working-capital line has not raised a round and should not be read as having done so.
What follows is what each instrument is, what it costs you, and when it is the wrong answer. cpg.vc takes no fee from any lender named here.
What it is. A lender advances against a confirmed purchase order or against inventory you already hold, and is repaid when the retailer pays. Purchase-order financing usually funds the production run itself; inventory lines are secured against stock on hand.
What it costs. Priced as a fee per period rather than an annual rate, which makes it look cheaper than it is — a 2.5% fee for 45 days is roughly 20% annualised. Always convert to an annual number before comparing.
When it is right. You have a signed PO from a creditworthy retailer and the only thing standing between you and revenue is cash for the run. The risk is on the retailer's balance sheet more than yours, which is why lenders will do it for brands too early for a bank.
When it is wrong. To fund a speculative build with no committed buyer. If the stock does not move, you are carrying financed inventory and the fee clock keeps running.
What it is. Capital repaid as a fixed percentage of monthly revenue until a set multiple is returned — typically 1.1x to 1.5x of the amount advanced. No equity, no board seat, no fixed maturity date.
What it costs. The multiple is the cost, and the effective rate depends entirely on how fast you repay it. Paying back 1.35x over twelve months is roughly 35% annualised; paying the same multiple over three years is far cheaper. Faster growth makes revenue-based financing more expensive, not less — the opposite of most people's intuition.
When it is right. Predictable direct-to-consumer revenue, a known contribution margin, and a use of funds that generates cash inside the repayment window.
When it is wrong. Lumpy wholesale revenue, or thin margins. A revenue share on a 20-point gross margin can leave you working for the lender.
What it is. The newest structure in the category, and the one worth understanding early. A facility finances marketing spend specifically — not general working capital — and is repaid from a capped share of the revenue that those acquired customers generate. Ownership is untouched.
The tracked example. cpg.vc has recorded a $1B customer-value facility from General Catalyst's Customer Value Fund, financing up to 70% of marketing spend, repaid from a capped share of the revenue attributable to the customers that spend acquires. If the cohort underperforms, the downside sits substantially with the lender rather than the brand.
When it is right. You have genuine cohort data — real payback periods, real retention curves — and your constraint is that scaling paid acquisition would eat your cash. This is the cleanest instrument in CPG for exactly that problem.
When it is wrong. You do not yet know your payback period. These facilities are underwritten on cohort quality; without that history there is nothing to underwrite, and the diligence will tell you so.
What it is. Conventional borrowing. A term loan is a lump sum on a fixed schedule; a revolver is a line you draw and repay as working capital swings; venture debt sits alongside an equity round and usually carries warrants.
What cpg.vc has tracked. A $125M term loan to Vital Farms from Silver Point Capital Direct Lending. A $45M revolving credit facility to Glossier from Tiger Finance. $10M of venture debt to Aukera across Alteria Capital, InnoVen Capital and Lighthouse Canton. Plantible Foods raised $35M as debt and equity together, with X-Caliber Rural Capital on the debt side.
What it costs. Interest, plus covenants. The covenants are the part founders underestimate — minimum liquidity, revenue tests, restrictions on further borrowing. Breaching one can hand the lender control at the worst possible moment.
When it is right. Real revenue, predictable cash conversion, and a use of funds with a return above the interest rate. Venture debt specifically makes sense as a bridge extending runway between equity rounds, on the assumption the next round happens.
When it is wrong. As a substitute for an equity round you cannot raise. Debt does not care why revenue missed.
Equipment finance secures against the machine itself, which makes it available earlier and cheaper than unsecured borrowing. The tracked example is $12.5M to The Coconut Cult from Bridge Finance Group. If you are moving from co-packing to owned production, this is usually the right instrument — the asset is the collateral, so you are not pledging the company.
Grants are the only genuinely free capital available, and the only one where the binding constraint is your time rather than your credit. In food and beverage they cluster around agricultural processing, rural development, sustainability and export development, and they are administered by bodies that do not advertise to founders. They are slow, paperwork-heavy, and worth pursuing in parallel with something faster rather than instead of it.
cpg.vc does not yet maintain a grant database. Saying so is more useful than publishing a thin one.
Match the instrument to the shape of the cash gap, not to what is easiest to get.
The gap is between production and retailer payment — purchase-order or inventory financing. The receivable is the collateral.
The gap is marketing spend you cannot self-fund — a customer-acquisition facility if your cohort data supports it, revenue-based financing if it does not but your revenue is predictable.
The gap is a capital asset — equipment finance, secured against the asset.
The gap is runway between equity rounds — venture debt, sized so that a slipped round does not become a default.
The gap is that you are unprofitable and growing — that is an equity problem. Debt against a structural loss compounds it. This is the case where non-dilutive capital is the wrong answer however attractive it looks next to a dilutive one.
One number decides most of it: your cash conversion cycle. Brands that cannot state theirs to the day should work that out before talking to any lender, because every conversation on this page begins there.
This page describes financing structures in general terms. It is not financial advice, and cpg.vc is not a lender or a broker. Terms vary enormously by brand, category and lender — get your own advice before signing anything.