What Is a Startup Loan?

Remember those old single-prop airplanes that needed a good push to get going? We like to think of your startup business like that. You’ve done a great job building the plane, diligently went over the safety protocols, and are sitting impatiently in the pilot’s seat. All you need is someone to give your a swift push so you can take off.

A startup loan is funding for a business that isn’t yet operating, but is ready to go. We provide the push, then watch your startup fly away and become a full-fledged small business.

Perfect! Give me a push!

We’d be glad to. At Lendio, we typically fund startups by getting you situated with either a business credit card or an SBA loan, depending on your personal situation. A credit card is the easiest and most surefire way to get funds for your business when you have no business history, as it relies on your personal finances instead of non-existent financial documents from your startup. If you have good credit (680 or higher), you’ll be in fantastic shape to get a startup loan and hit the ground running, er, flying.

In general, an SBA loan is significantly more difficult to acquire and takes far longer to approve, but it will provide better interest rates and larger loan amounts.

Okay, I’m interested. Tell me more.

Great. Let’s go over some of the details!

To start with, keep in mind that:

  • Your startup loan may have a higher interest rate than a loan for a more established business
  • You may have to personally guarantee the loan since you have no business history 
  • You may need collateral in order to secure the loan


On the other hand, there are some serious upsides:

  • You aren’t giving up any equity in your business
  • A startup loan will help your business establish a credit history for future purchases
  • And hey, it keeps you from having to ask your friends and family to loan you money for your business idea


Additionally, a startup loan can offer you anywhere from $500-$750,000 and the payments are always monthly. Interest rates typically range from 0-17%, and can be funded in 14 to 60 days. Finally, because there are two options for a startup loan, your loan term will either be 25 years or be structured as revolving credit with no term.

So, I can get decent financing without asking Grammy?

Absolutely! In fact, we highly recommend filling out our magical online application and seeing just how much you can get for your startup before bothering your Grandma. Unless you just really want some hard candies, of course.