How to Get a Startup Business Loan
Last year, LendingTree helped startups secure over $142 million in funding, with more than half going to businesses less than a year old.
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A startup business loan is financing for businesses that have been operating for less than two years. Unlike traditional business loans, which typically require a longer track record, startup loans are designed for newer businesses that may still be building revenue.
Best startup business loans
Are startup business loans an option for your business?
Business financing approval typically depends on factors like revenue, time in business and your credit profile.
Here’s what lenders typically look for:
- Time in business: Three to six months (some lenders require more)
- Annual revenue: Often $100,000+ (varies by lender)
- Credit score: 600+ (higher is better)
- Cash flow: Consistent deposits in a business bank account
Businesses under one year old that applied for and received loans through LendingTree in 2025 had an average annual revenue of $400,000.
If your business hasn’t started generating revenue yet, your options may be limited to grants, personal funding or microloans. You may also find options with online lenders or equipment financing providers, though these often come with higher rates and smaller loan amounts.
You could also consider reaching out to a Certified Development Financial Institution (CDFI) in your area. These local banks, credit unions and non-profits help individuals and small businesses get access to financial products. In addition to funding, many CDFIs offer training and support for new business owners.
See LendingTree’s full guide on getting startup business loans with no money.
Startup loan options at a glance
How much funding can I get as a startup?
According to the Federal Reserve, most startups apply for $100,000 or less, though some lenders offer loan amounts up to $5 million. How much you can borrow depends on your lender, loan type and overall financial profile. In general, startup loan amounts tend to be smaller than traditional business loans.
Start with what you need, not the maximum you qualify for. Borrowing too much too early can strain your cash flow and make it harder to qualify for financing in the future. Use a business loan calculator to estimate your monthly payments and total borrowing costs before applying.
What you’ll need to apply for a startup loan
Before applying, gather the key documents lenders use to evaluate your business. Having these ready can speed up the process and improve your chances of approval.
Business information
- Employer identification number (EIN) or Social Security number (for sole proprietors)
- Business licenses and registrations
Financial documents
- Business bank statements (typically three to six months)
- Personal and business tax returns
- Financial statements, such as profit and loss statements, balance sheets and cash flow reports
Additional materials
- A business plan (especially for newer businesses)
- Details on how you plan to use the loan
Some lenders may also ask you to connect your business bank account or accounting software to verify your revenue and cash flow.
Store these documents in a secure folder so they’re easy to access when applying with multiple lenders.
What is a good rate for a startup loan?
Business loan interest rates vary widely. Banks and credit unions typically offer the lowest rates, but startups may have a harder time qualifying due to stricter requirements.
Average rates for new term loans and lines of credit tend to fall around 6% to 8%, though the most competitive rates are usually reserved for highly qualified borrowers. As a startup, you may not qualify for a lender’s lowest advertised rate, though offering collateral can help.
See LendingTree’s full guide on the average business loan rates for 2026.
How LendingTree can help you get a startup business loan
Last year, LendingTree helped fund over 4,000 startup loans for businesses under two years old, including more than 2,000 loans for businesses less than a year old.
Instead of applying with multiple lenders, you can compare offers from our network of 30+ business lenders in one place.
How it works:
- Tell us what you need — Fill out a quick form in minutes.
- Compare offers — Review multiple loan options side by side.
- Choose and get funded — Select the best offer and receive funds, sometimes within 24 hours.
Checking offers through LendingTree involves a soft credit check, so it won’t impact your credit score. A hard credit check may occur if you move forward with a lender.
What to do if your loan application is denied
If your application is denied, you still have options:
-
Apply with a different lender
Requirements vary, so you may qualify elsewhere, especially with online lenders. -
Offer collateral
Securing your loan with assets may improve approval odds, but adds risk if you can’t repay. See LendingTree’s top picks for secured business loans. -
Increase your revenue
Higher or more consistent revenue can help you meet lender requirements. -
Improve your personal credit
Your credit score plays a major role for startups. Improving it can unlock better options. -
Build business credit
Establishing tradelines and using business credit responsibly can strengthen your application. -
Wait and reapply
As your business matures, you may qualify for better loan terms.
LendingTree research shows that access to funding can vary widely:
This can make it harder for some entrepreneurs to qualify for traditional financing, which is why alternative lenders and flexible funding options can play an important role.
Alternatives for pre-revenue startups
If you can’t qualify for a startup loan, consider these funding options:
-
Business credit cards.
Good for smaller expenses, but often come with high interest rates. -
Business grants.
Free funding offered by nonprofits, corporations and government entities that doesn’t need to be repaid, but can be competitive and time-consuming to secure. -
Crowdfunding.
Raise money from supporters online, often in exchange for rewards or early access. -
Family loans.
Flexible and accessible, but can strain personal relationships if not repaid. -
Personal loans.
Easier to qualify for than business loans, but may carry higher rates and personal risk if you can’t keep up with your payments.
How to decide what type of business loan to use
Before applying, choose the loan type that best fits how you plan to use the funds.
| Loan type | Best for | Pros | Cons |
|---|---|---|---|
| Term loan | One-time expenses (startup costs, equipment) | Predictable payments, structured repayment | Less flexible once funded |
| Line of credit | Ongoing expenses, cash flow gaps | Flexible, only pay interest on what you use | May have lower limits |
| Merchant cash advance (MCA) | Businesses with lower credit or inconsistent revenue | Easier to qualify for | Expensive, high fees |
Which loan is right for your startup?
- Choose a term loan if you need a lump sum to buy equipment, cover startup costs or open a physical location.
- Choose a line of credit if you want flexibility for tasks like covering payroll, managing cash flow or handling unexpected expenses as they come up.
- Choose a merchant cash advance if you have steady sales but don’t qualify for other loans and need fast funding, but be prepared for higher costs.