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Start-Up Business Loan Reviews

buyers guide
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  • AppsFunder

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    AppsFunder is a crowdfunding site with an exclusive focus on apps and a particular means of conducting crowdfunding. Beware of the higher fees compared to those of the competition.

  • Avant

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    Avant is a lender that offers personal loans to qualified borrowers. Avant’s service is transparent, the application process is fast, and the customer service is responsive. It is ideal for startups but not suitable for large businesses.

  • Best Egg

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    Best Egg offers personal loans which can be used for business to qualified borrowers. It is best suited for entrepreneurs who need a small amount of money to start a business, provided they have strong personal creditworthiness and financials.

  • Capify

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    Capify is a merchant cash advance service and alternative lender. Capify specializes in providing working capital to businesses with poor credit but good cash flow. While Capify is a legitimate lender, they have expensive terms and fees and not suitable for seasonal businesses.

  • Crowdfunder

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    Crowdfunder is not a fundraising platform for personal causes, charities, or nonprofits. It is explicitly targeted at entrepreneurs and startups with high growth potential.

  • Discover Personal Loans

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    Discover Personal Loans offers personal loans that can be used for funding a start-up business. Borrowers with good credit would do well to consider Discover Personal Loans as a source of funding for their business start-up. Be cautious about their high interest rates and stringent borrower qualifications.

  • Everest Business Funding

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    Pros Relaxed credit score requirements 2-7 days time to funding Cons High factor rates Some additional fees Overview Everest Business Funding is a Florida-based merchant cash advance (MCA) alternative funder serving small businesses. Like similar companies, it provides short-term capital for businesses that may have difficulty qualifying for traditional lending. Overall, Everest strikes me as a fairly […]

  • Forward Financing

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    Forward Financing is an online funder that specializes in providing small businesses with capital on short notice, emphasizing technology, transparency, integrity, and speed. Their rates fall on the higher side. However, if your credit rating is limiting you to high-rate funders, and you absolutely need funding, Forward Financing maybe worth considering.

  • Fundable

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    Fundable is less geared toward starry-eyed dreamers with wild ideas and more toward startups and companies with a solid plan of action. Fundable gives businesses the choice of launching either a rewards-based crowdfunding campaign (à la Kickstarter) or an equity-based campaign in which backers get a share of stock in the company in exchange for their backing.

  • FundRazr

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    Pros Excellent public reputation No platform fees (if you choose the free package) Nonprofit fundraising supported Can keep whatever you raise Cons Some support materials are dated The platform is less trafficked than major competitors Overview Born in the late 2000s (as crowdfunding began its meteoric rise to fit our capital-starved post-Great Recession era), FundRazr […]

What is a Startup Business Loan?

Although term “startup” has many definitions, for the purposes of this category, we define startup loans as any loans used to launch a business. All lenders (and other types of business financiers) reviewed in this category offer financing to businesses three months old or younger.

If you want to know whether your business is eligible to borrow from a specific lender, look at the “Borrower Qualification” section of the review, which lists all the basic benchmarks your business must meet to be eligible for financing.

Startup financing can come from a number of different sources. Here are the most common:

Friends and Family

If you can no longer fund your business enterprise using your own resources, the next step for many entrepreneurs is to borrow from friends and family. Loans from these sources are very flexible, as they don’t tend to carry interest rates or require a set repayment schedule like other sources of capital. However, if you (or your friends and family) want a little more structure, some platforms help you draft up legal documents, create a payment schedule, disperse payments, and other services.

Personal Loans and Lines of Credit

Although it’s not generally advisable for merchants to mix personal and business expenses, exceptions are often made for startups. Because personal loans are based on your own creditworthiness (and not that of your business), they are often a viable source of financing for startups.

Unfortunately, personal loans are not always easy for entrepreneurs to get. To be eligible for a personal loan, you will have to have at least fair personal credit and a strong source of revenue to support repayments.

Business Loans and Lines of Credit

While more difficult to obtain than from other sources, it is possible to get a business loan or line of credit for your startup via your bank, credit union, the SBA, or an alternative (non-bank) lender.

Often, the easiest source of startup business loans is via a nonprofit. These institutions seek to strengthen communities by helping local businesses, and are often able to offer loans with relatively inexpensive rates and fees.

Entrepreneurs who have collateral to put up (such as a house or vehicle) will have an easier time using this type of financing.


A type of funding that has become popular as of late, crowdfunding simply entails raising money via contributions from a large number of people. There are a few different types of business crowdfunding arrangements which vary based on what backers receive for their investment:

  • Debt: You must repay the money borrowed plus interest or a borrowing fee for borrowing. Backers receive their investment back plus some of the interest or fee.
  • Equity: Backers have a share of your business and future revenue.
  • Rewards: Backers receive some sort of reward, often a product made by your business.
  • Donation: Backers simply donate money and receive nothing in return.

Regardless of the rewards model, businesses who use crowdfunding will have to set up a profile, market their business or product, and otherwise attract backers. For this reason, a crowdfunding campaign can take up to a few months to complete.

Cash Flow Financing

Many business lenders are primarily concerned about your business’s overall profitability, which means that startups are often exempt from borrowing. Cash flow financiers, on the other hand, are more interested in your day-to-day revenue stream. The better your revenue, the more money you will be eligible for. As you might expect, cash flow financing is best for startups that are already generating consistent revenue.

Cash flow financing can come in two forms:

  • Short-Term Loans: As the name might suggest, these are loans with short borrowing term lengths. Generally, instead of interest, they carry a fee that is between 10% and 60% of the borrowing amount, and must be repaid on a daily or weekly basis.
  • Merchant Cash Advances (MCAs): Much like short-term loans, merchant cash advances charge a fee of 10% – 60% of the borrowing amount (instead of interest). However, your advance will be repaid by collecting a percentage of your daily sales.

Cash flow financing tends to require hefty fees and fast repayment schedules, so it’s generally advisable to exercise caution and explore other options before resorting to short-term loans or MCAs.

Any cash flow financier that funds businesses of six months or younger will fall into the startup loans category, but for a full list, head over to the merchant cash advance review category.

Invoice Factoring

B2B businesses often have unique cash flow problems caused by slow-paying customers. If you run such a business, invoice factoring may be the solution. Because invoice factoring is contingent on your customers paying, even startups and young businesses are eligible for financing.

In an invoice factor arrangement, a business sells invoices to a factoring company at a discount in exchange for immediate capital. In doing so, merchants can solve problems that may be caused by unpaid invoices and keep their businesses running smoothly.

Invoice factors are not covered in our startup loans category. For a full list of reviews, head over to our invoice factoring category.

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The vendors that appear on this list were chosen by subject matter experts on the basis of product quality, wide usage and availability, and positive reputation.

Merchant Maverick’s ratings are editorial in nature, and are not aggregated from user reviews. Each staff reviewer at Merchant Maverick is a subject matter expert with experience researching, testing, and evaluating small business software and services. The rating of this company or service is based on the author’s expert opinion and analysis of the product, and assessed and seconded by another subject matter expert on staff before publication. Merchant Maverick’s ratings are not influenced by affiliate partnerships.

Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity. The editorial content on this page is not provided by any of the companies mentioned and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author’s alone.

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