Startup Business Loans With No Revenue [Unsecured Loans]

Startup business loans with no revenue are rare, challenging to access, and unlikely to be an option for most businesses.

In this article, we’re going to explain why this is the case. And, we’ll also share in which situations it may be possible to access unsecured loans for your business.

We will also answer common questions we receive on the topic and help you explore alternative funding options as well.

This article is part of our free series on business banking, including how to find the best bank to open a business account in top jurisdictions around the world.

Feel free to use the table of contents to jump ahead to the sections most relevant to you.

Table of Contents

  1. Startup Business Loans With No Revenue
  2. Reasons to Get a Startup Business Loan
  3. How to Get Startup Business Loans
  4. Frequently Asked Questions
  5. Do You Want Help Opening Bank Accounts?

Startup Business Loans With No Revenue

Startup business loans with no revenue refer to unsecured financing that can be accessed by businesses that have yet to generate any money. Not surprisingly, this type of unsecured financing is rare, though not impossible to find.

One of the main reasons that it is very difficult for businesses to access loans without revenue is because, without revenue, they will be unable to meet repayment obligations. As a result, business loans without revenue often have a personal guarantee attached.

In fact, business loans for businesses with revenue may also have a personal guarantee attached, which is the case with Small Business Administration loans.

But, as mentioned, there are financing options available for businesses with no revenue. In the following sections, we will look at these options, along with discussing the specific reasons you may want to consider a loan for your early-stage business instead of raising capital.

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Reasons to Get a Startup Business Loan

If you are able to qualify, there are a number of reasons to consider a startup business loan over other alternative sources of financing. One of the main reasons to consider a loan is that it protects shareholding as loans are non-dilutive. Business loans can also be open-ended, leaving room for future expansion, and providing access to emergency financing.

Benefits of Business Loans

  • Non-dilutive source of capital
  • Tax advantages compared to equity
  • Builds credit history for the business
  • Attractive terms for specific purchases
  • Flexible repayment and terms
  • Emergency source of capital

How to Get Startup Business Loans

Importantly, if you are looking for a business loan and your business does not have any revenue, you will likely skip traditional sources of financing like commercial banks. Instead, you will need to seek alternative financing options, especially those that offer unsecured financing to early-stage businesses.

In most cases, these loans are offered by government agencies or investment funds with a specific mandate to help early-stage businesses that cannot access funding elsewhere. As a result, these loans can involve attractive rates. In fact, certain government initiatives may involve a cash injection with no requirement for repayment.

Of course, if you are looking to access startup business loans with no revenue, you will need to apply for these programs and get accepted. However, in most cases, due to the attractiveness of the offer, these programs are very competitive. As a result, only a very small number of applicants get accepted.

With this in mind, we will continue to discuss the possibilities of startup business loans below. We will also discuss other alternative financing solutions you may want to consider as well.

Business Financing Options

  • Government grants & directed investment programs
  • Crowdfunding and other consumer-backed alternatives
  • Cash advances from payment processors
  • Small Business Administration (SBA) loans
  • Bank financing from existing relationships
  • Cash flow loans for businesses with revenue
  • Income-qualified financing options
  • Financing secured against equipment and assets

Does My Credit Score Affect Financing Options?

Yes, if you are the primary shareholder in a startup, your credit score is going to affect the possible financing options that your business can access. In fact, the credit score of the founder can also impact the interest rates that an early-stage business may be offered.

Frequently Asked Questions

Below are a few of the most common questions we receive from people looking into how to get startup business loans with no revenue. If you have further questions you would like to ask our team, don’t hesitate to get in touch.

Can I Get a Business Loan With No Money Down?

Yes, it is possible to get a business loan with no money down. However, it depends on the business and the type of loan. For example, many businesses can qualify for a loan based on their revenue, profitability, and asset base. However, if your business does not have any revenue, is not yet profitable, or does not have any assets, it will be very difficult to qualify for a loan.

Is it Hard to Get a Startup Business Loan?

Yes, it is very hard to get a startup business loan without applying to specific programs that are designed to fund early-stage ventures. With this in mind, if you are looking for a loan for a startup, especially if the business has no revenue, you should look for programs that specifically offer financing to these businesses.

Can I Get a Startup Business Loan With No Credit Check?

No, you cannot get a startup business loan with no credit check. This is because checking the credit of an applicant is part of the process that every financial institution must go through in order to assess the creditworthiness of loan applicants. Additionally, if you are applying for a business that does not have its own credit history, the primary shareholder(s) in the business will also have a credit check performed on themselves personally.

How Can I Fund My Small Business With No Money?

You can fund your small business with no money by applying to the various investment programs, incubators, and microcredit providers that are available in your area for early-stage businesses. If you are unable to access those opportunities, you may want to consider crowdfunding and consumer-backed financing alternatives from individuals interested in your products or services.

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