Can I get a business loan with no revenue?
Pre-revenue startups have very limited options. The most accessible are equipment financing (which uses the equipment as collateral), SBA Microloans administered through CDFI intermediaries (which may accept strong personal credit and a business plan), Kiva (crowdfunded 0% microloan, up to $15,000), and CDFI loans through mission-driven lenders. Most MCA and alternative business loan programs require at least 3–6 months of consistent bank deposits.
What credit score do I need to get a startup business loan?
For SBA Microloans through CDFIs, there is technically no hard minimum — personal credit is one factor but can be offset by a strong business plan and use of funds. For alternative lenders like Fundbox (3-month minimum), a 600+ FICO is typically needed. For SBA 7(a) loans, 680+ is the practical minimum. Some MCA programs accept 500+ with 3+ months of revenue history.
How much can a startup typically borrow?
Realistic ranges: $5,000–$15,000 (Kiva, CDFI microloan with no revenue); $15,000–$50,000 (SBA Microloan, CDFI programs, equipment financing with down payment); $50,000–$250,000 (strong personal credit + 6+ months revenue, alternative lenders); $250,000+ generally requires 12+ months in business with documented revenue.
What documents does a startup need to apply for funding?
Business plan with financial projections, personal tax returns (2 years), personal bank statements (3–6 months), business bank statements (whatever exists), government-issued ID, EIN or SSN, business formation documents (Articles of Incorporation, operating agreement), and a clear explanation of how funds will be used and repaid.
Is the SBA Microloan program right for my startup?
The SBA Microloan program is specifically designed for startups and early-stage businesses that cannot access traditional financing. It offers up to $50,000 at 8–13% interest rates with terms up to 7 years. Unlike most SBA programs, it is administered through nonprofit CDFI intermediaries who can be more flexible on credit and time-in-business requirements. Startups received 26% of all SBA Microloans in the most recent fiscal year tracked.
How long does it take to get startup funding?
Timeline varies dramatically: SBA Microloans through CDFIs typically take 2–4 weeks from application to funding. Alternative lenders like Fundbox can fund in 2–3 business days for qualified applicants. Equipment financing for specific purchase orders can close in 2–7 days. Kiva campaigns take 30+ days due to the crowdfunding model. Traditional SBA 7(a) loans take 30–90 days.
Do I need collateral for a startup loan?
Most SBA Microloans require 'some type of collateral plus personal guarantee' per SBA guidelines — but this is flexible and evaluated case-by-case. Equipment financing uses the purchased equipment as collateral. Alternative business loans under $150,000 are typically unsecured but require a personal guarantee. Kiva is completely unsecured. The less history and revenue your business has, the more collateral matters.
Can I use startup funding to pay myself a salary?
Use-of-funds restrictions vary by program. SBA Microloans allow payment of owner salary if it's a legitimate business expense, but this can reduce your fundable amount since lenders evaluate how money generates repayment ability. Equipment financing is restricted to equipment. MCA and general working capital loans typically have no use restrictions. Be transparent about intended use on your application.
What's the difference between a startup loan and a startup grant?
A startup loan must be repaid with interest or fees. A grant does not require repayment. Grants are far harder to obtain and typically require specific demographics, industries, or use of funds (research, green energy, etc.). The SBA does not offer grants to start or expand businesses. Most 'startup grants' are actually competitive awards from corporations (FedEx Small Business Grant), foundations, or state economic development agencies — not broadly available programs.
What happens if my startup fails and I can't repay the loan?
This depends on the loan structure. If you signed a personal guarantee (common for startup loans), the lender can pursue your personal assets if the business cannot repay. SBA Microloans typically require personal guarantees. Equipment financing failure means the lender repossesses the equipment. If there is no personal guarantee and no collateral, the lender takes a loss and may report it to business credit bureaus. Always understand the personal liability before signing.