Obtaining a Business Line of Credit with No Revenues

Obtaining a Business Line of Credit with No Revenue

Jun 15, 2024

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Starting a business is exciting. Yet, one major hurdle many face is finding the funds to get their ideas off the ground, especially when there’s no cash coming in yet. It might seem like an impossible task to convince someone to lend you money under these conditions.

Did you know startups can still find ways to secure funding despite having no income? This guide is here to show you how.

We’ll explore different types of loans and financial tools that are friendly to businesses just starting out, like microloans and financing for equipment. You’ll learn how even without revenue, offering up something as collateral or bringing in a cosigner can open doors.

Plus, we'll share tips on making your business more appealing to lenders - everything from crafting a strong plan for your enterprise to understanding what these moneylenders look for.

Stick around; this could be what gets your business moving. 

Starting a business is exciting. Yet, one major hurdle many face is finding the funds to get their ideas off the ground, especially when there’s no cash coming in yet. It might seem like an impossible task to convince someone to lend you money under these conditions.

Did you know startups can still find ways to secure funding despite having no income? This guide is here to show you how.

We’ll explore different types of loans and financial tools that are friendly to businesses just starting out, like microloans and financing for equipment. You’ll learn how even without revenue, offering up something as collateral or bringing in a cosigner can open doors.

Plus, we'll share tips on making your business more appealing to lenders - everything from crafting a strong plan for your enterprise to understanding what these moneylenders look for.

Stick around; this could be what gets your business moving. 

Key Takeaways

  • You can get a business line of credit without revenue by having a good credit score and offering collateral or adding a cosigner.
  • Different loan options for startups with no money include microloans, equipment financing, invoice financing, and business credit cards.
  • Crowdfunding lets businesses raise small amounts of money from many people online without needing a credit check or banking history.
  • Creating a detailed business plan and building your business's credit rating are vital steps to secure funding from lenders.
  • Offering something valuable as security or finding someone with good financial standing to sign the loan with you can increase your chances of getting approved.

Understanding a Business Line of Credit

A business line of credit is like a safety net for your company. Think of it as a pool of money you can dip into whenever you need to cover expenses or invest in opportunities without reapplying each time.

Just like using a credit card , you only pay interest on the amount you use, not the full limit accessible to you. This type of borrowing offers incredible flexibility because businesses can withdraw funds up to a set limit at any given time, making it ideal for managing working capital needs or handling unexpected costs.

Businesses value this kind of loan for its adaptability; whether it's restocking inventory quickly or taking care of urgent repairs, having access to immediate funds without jumping through hoops every time is a game-changer.

Plus, as you repay what you've borrowed, that amount becomes available again - ready to be used when the next need arises. This revolving nature ensures that businesses are never left stranded financially and always have backup.

A line of credit empowers businesses with ongoing access to funds, ensuring they can leap onto opportunities or tackle emergencies head-on.

Moving on from how lines of credit work brings us closer to exploring whether acquiring such financial support is feasible even without revenue streams in place.

Possibility of Acquiring a Business Line of Credit with No Revenue

Moving from understanding what a business line of credit is, we see that getting one without any income might sound tough. Yet, some lenders focus on other parts of your business instead of just how much money you make.

They look at your credit score and how long your company has been up and running. Even if you haven't made $100,000 to $250,000 yet, which many banks ask for, there's still a chance.

To fit into this opportunity, having a good credit history becomes key. Banks and other financial bodies may skip over the revenue part if they see strength in these areas. So even startups or businesses not making money yet can find ways to get the funds they need through lines of credit or loans tailored for newcomers.

Types of Business Loans for Startups with No Revenue

Different loan options exist for new companies without money coming in, including small bank loans, gear buying plans, bill promises, and company charge cards. Keep reading to find out how these can help your startup grow.


Microloans are small loans that give up to $50,000 to help startups and small ventures grow. These loans are usually more accessible than bigger business loans. Small businesses often use them when they're starting out.

Microloans can pay for things like supplies, furniture, and software.

Getting a microloan is often easier than securing larger amounts of money from banks or other financial institutions. They are a good option for owners who might not qualify for traditional financing due to low credit scores or lack of revenue.

With microloans, you can kickstart your project without the heavy burden of high-interest rates or unmanageable repayment terms.

Equipment Financing

Equipment financing helps startups get the tools they need without paying all at once. This type of loan covers 100 percent of the cost for things like computers, ovens, or trucks.

Your credit score, how long you've been in business, and the tool's importance to your work influence your terms. It allows you to pay over time instead of a huge sum upfront.

With equipment financing , securing essential machinery becomes attainable for startups, making it easier to focus on growth rather than financial constraints.

Invoice Financing

Moving from equipment financing, we shift our focus to invoice financing . This option is perfect for businesses that need cash but haven't gotten paid yet by their clients. Invoice financing companies can give you up to 90 percent of the money your invoices are worth right away.

You use the unpaid bills as collateral, which means you're borrowing against the money you will soon collect.

This method is a smart choice if your business has a lot of sales on credit and you often wait for payments. It boosts your cash flow without waiting for customers to pay their invoices.

With this approach, companies like accounts receivable financiers step in to help manage these financial gaps by providing an advance against outstanding invoices.

Business Credit Cards

Business credit cards are a good way for startups to build and boost their credit rating. Companies like Bluevine and OnDeck offer these cards. They allow a max loan amount of up to $250,000.

You need at least a 625 credit score to get one. These cards can cover business expenses, offering benefits like cash back or points.

Next, let's explore how you can secure a startup business loan even without revenue on hand.

Securing a Startup Business Loan with No Revenue

Getting a loan for your startup with no money coming in might seem hard. You can make it easier by knowing what banks want and showing you can pay them back.

Offering Collateral

Offering collateral means you give the lender something valuable to hold onto. This could be things like your office building, machines you use for work, or items in your store. Collateral makes lenders feel safer because if you can't pay back the loan, they can take these items as payment.

Collateral provides security to lenders and increases your chances of getting a loan.

Your items' value helps decide how much money you can borrow. Real estate, heavy machinery, and goods for sale are some examples of what you might offer as collateral. Banks and other loan providers look at these assets closely before deciding on your loan application.

Adding a Cosigner

Adding a cosigner can boost your chances of getting a startup loan, even if your business has no revenue. A cosigner with a good credit history or stable income makes the loan less risky for lenders.

This means they might be more willing to approve it. Sharing the responsibility of the loan with someone else helps assure the lender that the loan will be paid back.

Knowing about lender requirements is key after considering a cosigner. Each lender has different needs and understanding them can help you better prepare for securing that needed funding.

Moving forward, learning about these requirements is essential.

Understanding Lender's Requirements

Each lender sets specific rules for a small business loan or a line of credit. They often look at your credit score, how long you've been in business, and how much money your company makes.

For example, OnDeck and Bluevine want to see a minimum credit score of 625 before they consider lending you money. Knowing these details can help you figure out if you qualify for their financial products.

Next, let's explore how to show lenders that you can pay back the loan even when your startup isn't making any money yet.

Assessing Repayment Capability

Lenders look at how a business plans to pay back the loan before they approve it. They consider things like how much money the business expects to make and its overall plan. Understanding interest rates and how long you have to repay is crucial too.

Next, we'll explore the advantages and drawbacks of startup loans with no income.

Pros and Cons of Startup Loans with No Revenue

Securing a startup loan with no revenue presents both opportunities and challenges. Here, we examine the advantages and drawbacks through a straightforward comparison.



Access to capital allows for business growth and development.

Higher interest rates and fees can increase the cost of borrowing.

Maintains ownership control without having to give equity to investors.

Often requires a personal promise or assets as security, putting personal assets at risk.

Helps establish a credit history for the business, making future financing easier.

Difficult to qualify without revenue, requiring strong personal credit or collateral.

This summary points out the critical aspects of considering such financial options for your startup. Access to funds can be a game changer, offering the resources needed for critical operations or expansion. On the flip side, the cost and risks associated come into play, especially in the form of higher borrowing costs and the jeopardy of personal assets. As such, weighing these factors is crucial in decision-making for your business's financial strategy.

Alternative Funding Options with No Revenue

Exploring different ways to get money for your business without making sales yet can open new doors. Options like crowd-supported funding, getting help from wealthy sponsors, or borrowing from those close to you might be the right path.


Crowdfunding lets businesses collect small amounts of money from many individuals over the internet. This method is great for startups without revenue because it does not require a credit check or banking history.

Sites like Kiva and Indiegogo make it easy for entrepreneurs to start their crowdfunding campaigns. By sharing their business ideas online, they can connect with people all over the world who are willing to support them.

Crowdfunding can turn your business idea into reality by pooling funds from a global community.

It also serves as an effective tool for online marketing, showcasing the product or service to potential customers before it hits the market. This approach not only raises startup capital but also creates buzz and interest in what the business is offering.

Seeking Investors

After exploring crowdfunding, looking for investors is another step for startups without revenue. This option involves trading parts of your company's ownership in exchange for money.

Angel investors and venture capital firms are key players here. They give a lot of money to help your business grow. In return, they own a piece of it.

Finding the right investor can mean big things for your startup. These people or groups also offer guidance and connections besides just cash. But you must impress them with a strong business plan and show how their investment will pay off.

Loans from Family and Friends

Getting a loan from family and friends is often easier than going through banks. These loans don't usually need hard credit checks. You can work out flexible payback terms with them, which helps when you're starting without much money.

This way, both sides know what to expect in terms of repayment.

It's key to handle these loans with care to avoid any personal issues later on. Writing down the loan terms clearly makes everything fair for everyone involved. Plus, treating it as a professional agreement keeps relationships healthy, ensuring that your business gets the support it needs while maintaining good ties with loved ones.

Impact of No Revenue on Business Loans

Having no revenue can make getting a business loan tough. Lenders see loans as more risky if the business isn't making money yet. This means businesses with no cash coming in might face higher interest rates and stricter terms on their loans.

They need to prove they have other ways to pay back what they borrow. Some lenders focus on future earnings or reliable clients, like those using invoice financing.

Businesses should plan carefully if they're thinking about taking a loan without income. They must show strong plans for making money and managing debt. Using assets as security or finding someone to sign the loan with you can help.

Looking into different types of loans, such as merchant cash advances or equipment financing, is also smart. Each choice comes with its own costs and benefits that need careful thought.

Next, let's explore tips for securing a business loan despite having no revenue.

Tips for Securing a Business Loan with No Revenue

Creating a strong business plan shows lenders you have a clear path to success. Building your business credit score opens doors with banks and other financial bodies.

Developing a Solid Business Plan

Crafting a thorough business plan is crucial for convincing lenders your venture has potential. This document outlines your company's structure, market research, and how you expect to make money.

It's like a roadmap showing where you're starting, the path you plan to take, and where you see yourself in the future. Details about your product or service, who will buy it, and why it's better than what’s already out there are key parts of this plan.

Your financial forecasts are another major component. They show lenders you've thought about costs, sales, and making a profit. You'll need to include income statements, balance sheets, cash flow statements from resources like Funding Circle or American Express for startup financing examples.

These projections help prove that despite having no revenue now, your business can pay back what it borrows in time.

Establishing Business Credit Rating

To build a good business credit score, start by getting and using a business credit card wisely. Pay off your debts on time every month. This shows lenders you can manage money well.

A strong credit score makes banks more likely to give you loans.

Also, make sure all your bill payments are on time, not just the credit card ones. Late payments hurt your credit rating fast. Keep debt low compared to what you can borrow. This ratio matters a lot for your score too.

Better scores mean better chances at bigger loans with lower interest rates in the future.

Demonstrating Profitability Potential

After building a good business credit rating, showing how your company will make money becomes vital. Lenders want to see a clear path to profitability before they offer you funds.

You need a strong revenue model and evidence of market demand for what you're selling. This means laying out your plan for how the business will earn more than it spends.

You should also highlight any pre-sales or contracts already in place that promise future income. This proves there's real interest in your product or service. By presenting data on potential sales and growth, you make a compelling case to lenders that investing in your startup is worth the risk.


Getting a business line of credit with no revenue might seem tough, but it's possible. Options like microloans, equipment loans, invoice advances, and business charge cards are there for you.

You can secure these by offering something valuable as collateral or having someone cosign. Knowing what lenders want and showing you can pay back the loan are key steps. Also consider other funding ways like crowdfunding or asking family for help if traditional loans don't work out.

This guide shows that even without money coming in yet, your startup has many paths to find the funds it needs to grow and succeed.

For more useful tips and insights, watch this video for steps on how build business credit


1. What is a business line of credit?

A business line of credit is money that businesses can borrow up to a certain limit, use when needed, and repay later. It's like having extra cash for your business needs.

2. Can I get a business line of credit if my business makes no money yet?

Yes, even if your business has no revenue, you might still get a line of credit through options like secured loans or by using accounts receivable financing.

3. What are some ways to obtain funding without revenue?

Start-ups can look into invoice factoring, peer-to-peer lending platforms, venture capital (VC), and equity financing as ways to get funds without having made any money yet.

4. How do small-business loans work for new businesses?

Small-business loans give new businesses a lump sum of money to help with start-up costs. You have to pay this back over time with interest. Some options include unsecured loans and SBA-backed loans which may offer lower interest rates.

5. What should I consider before applying for a loan with no revenue?

Before applying, think about how you'll repay the loan and understand terms like annual percentage rates (APRs). Also, improving your FICO score and exploring grants or community development financial institutions (CDFIs) might be helpful.

6. Why is it important to talk to a financial consultant before getting a loan?

Talking to a financial consultant helps you understand all your options better, including debt service coverage ratios and how different types of financing affect your business finances in the long run.

You must also explore this episode on Spotify to increase your approvals for business loans


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