Best Startup Business Loans

The best startup business loans should be available to new businesses, have reasonable borrower requirements, and have competitive interest rates and terms.

Erica began writing on small business topics in 2008. She joined Merchant Maverick in 2018 and focuses on loans, accounting, and POS. She is a Certified ProAdvisor for QuickBooks Online and QuickBooks Payroll. She has been cited in MSN, Reader's Digest, Vox, U.S. News & World Report, and Real Simple. She is a graduate of Limestone University and resides in Greenville, South Carolina.

• WRITTEN & RESEARCHED BY

  Erica Seppala Erica began writing on small business topics in 2008. She joined Merchant Maverick in 2018 and focuses on loans, accounting, and POS. She is a Certified ProAdvisor for QuickBooks Online and QuickBooks Payroll. She has been cited in MSN, Reader's Digest, Vox, U.S. News & World Report, and Real Simple. She is a graduate of Limestone University and resides in Greenville, South Carolina.

  Editor & Senior Staff Writer

  Last updated onUpdated April 24, 2024



Chelsea Krause is a writer who specializes in accounting, payroll, and small business loans. She has been with Merchant Maverick helping small business owners manage their finances since 2016. She is a QuickBooks Certified User and former eCommerce store owner. Her accounting expertise has been quoted in Forbes and her work appears in Startup Nation, Small Business Bonfire, and Women on Business. Chelsea graduated summa cum laude with a BA in English & Creative Writing from George Fox University and studied abroad at the University of Oxford as well. She currently resides in Boise, Idaho.

REVIEWED BY

Chelsea Krause Chelsea Krause is a writer who specializes in accounting, payroll, and small business loans. She has been with Merchant Maverick helping small business owners manage their finances since 2016. She is a QuickBooks Certified User and former eCommerce store owner. Her accounting expertise has been quoted in Forbes and her work appears in Startup Nation, Small Business Bonfire, and Women on Business. Chelsea graduated summa cum laude with a BA in English & Creative Writing from George Fox University and studied abroad at the University of Oxford as well. She currently resides in Boise, Idaho.

Lead Staff Writer

Startups need capital to get off the ground, but the best small business loans often require a company to have been in business for at least two years to qualify for funding. Nevertheless, it is still possible to get startup business loans with reasonable terms, although it may take a little more research.

In this post, we’ll look at the best startup business loans from lenders who work with new businesses.

Learn More About Our Top Picks

Read more below to learn why we chose these options.

6 Best Business Startup Loans

The best startup business loans should be available to new businesses and should have reasonable borrower requirements and competitive interest rates. Generally speaking, they should also have longer repayment terms so as not to be too big a burden on a new business owner’s finances. Here are our picks for the best startup business loans.

• Upstart: Best For Young Entrepreneurs
• Accion: Best Startup Loans For Underserved Borrowers
• Fundable: Best Crowdfunded Startup Loans
• BusinessLoans.com: Best Marketplace For Startups
• Discover Personal Loans: Best Startup Loans For Borrowers With Good Credit
• LendingClub Personal Loans: Best Startup Loans For Building Credit

How The Best Startup Business Loans Compare

Upstart: Best For Young Entrepreneurs

Get Started With Upstart

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Accion: Best Startup Loans For Underserved Borrowers

Get Started With Accion

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Fundable: Best Crowdfunded Startup Loans

Get Started With Fundable

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BusinessLoans.com: Best Marketplace For Startups

Get Started With BusinessLoans.com

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Discover Personal Loans: Best Startup Loans For Borrowers With Good Credit

Get Started With Discover Personal Loans

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LendingClub Personal Loans: Best Startup Loans For Building Credit

Get Started With LendingClub Personal Loans

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Business Loan & Funding Products Review Methodology

We spend hours researching and evaluating each business loan and funding product that we review at Merchant Maverick, placing special emphasis on key characteristics to generate our ratings.

When rating lenders and funding providers, we use a 31-point rubric that looks at rates and fees, services, eligibility requirements, application, sales and advertising transparency, customer service, and user reviews. We weigh each section differently to calculate the total star rating. This rubric is applied to traditional term loans, as well as short-term loans, start-up loans, lines of credit, online lending products, merchant cash advances, and equipment financing products.

• Rates & Fees: 20% of the total star rating
• Services: 20% of the total star rating
• Eligibility Requirements: 20% of the total star rating
• Application: 15% of the total star rating
• Sales & Advertising Transparency: 10% of the total star rating
• Customer Support: 5% of the total star rating
• User Reviews: 5% of the total star rating

Each section is further broken down into granular, weighted subsections, in which we examine specific attributes like terms lengths, conditions of repayment, credit score and revenue requirements, ease of application, length of time to funding, the ethics involved in promoting the lending product, customer support, and the overall reputation of the lender or funding provider.

Read more about how we rate small business lenders.

Types Of Startup Business Loans

The lenders we selected offer a few different types of business loans. These include:

• Term loans: Term loans can be personal loans or business loans. They typically have longer repayment terms and lower interest rates, making them ideal for startups.
• Microloan: Essentially, a small business microloan is a term loan for less than $50,000. These are often easier to get and have better rates than larger-term loans, making them ideal for startups.
• Short-term loans: These have flat fees and repayment terms usually under 18 months. With short-term loans, payments are made daily or weekly. Short-term loans are generally not a good fit for brand-new businesses but may work for those that have been in business for a few months and are generating revenue.
• Crowdfunding: Generally, crowdfunding for business has low borrower requirements and costs but requires more legwork. It’s best for entrepreneurs who are good at generating publicity or donor interest.
• Merchant cash advance: Like short-term loans, merchant cash advances are revenue-dependent. They tend to be expensive. MCAs may work for businesses that have been around a few months and do a lot of credit card sales.
• Lines of credit: With a line of credit, you can establish a fund you can draw upon at will up to a credit limit. These may be challenging to get as a startup, but it can be an excellent choice if you don’t know exactly how much your expenses will be.

How To Choose The Best Startup Loan

The best startup loan for your business idea may not necessarily be the best startup loan for someone else’s. You’ll want to keep in mind the following factors when you’re looking:

• The amount of money you need to borrow
• Loan repayment time
• How soon your revenue will come online
• The total cost of borrowing (interest, fees, etc.)
• Your personal credit score and credit history
• Any collateral requirements
• Your resources for running a crowdfunding campaign (if you choose to)

With all of these elements in mind, you’ll be able to pinpoint the best startup business loan for your needs.

FAQs: Startup Business Loans

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