Secure a Loan for Your Startup

How to Secure a Loan for Your Startup: Practical Advice and Strategies

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With the rise of cryptocurrency, startups worldwide are turning to innovative financing options, like bank loans. In this blog post, we’ll explore how you can secure a loan for your startup and help you navigate the complexities of the process.

Understanding the Basics of a Bank Loan From Your Point Of View


Before getting started with securing a bank loan from any bank, it is essential to understand what an asset-based lending model means and when it will be available to potential lenders. The basic concept behind asset-based lending models is that investors provide financial resources or assets in exchange for interest payments from borrowers. This means investors can borrow money at attractive rates while giving access to risk-free investment returns. Many companies turn to debt financing because they want access to capital at favourable terms and conditions. However, before entering into an agreement with a lender or seeking funding from a bank, it is crucial to understand the following elements:

What Is An Asset-Based Lending Model?

Asset-Based Lending Model

An asset-based lending model involves creating a business entity with no shareholders and then selling shares to raise funds for operations. When individuals or entities engage in stock purchases, they typically invest in real estate, which can generate attractive returns. These investments may include but are not limited to land parcels, buildings, machinery, equipment, vehicles, etc. Investors in these types of businesses can also receive dividends or distributions paid out quarterly, annually, or monthly.

Assets being sold are usually put up for sale through commercial property, real estate investment trusts (REITs), or other forms of equity investments. There are several ways of obtaining collateral for such investments, including personal savings accounts, real estate properties, intellectual property, or stocks. Other strategies, such as raising capital through borrowing, require additional documentation and verification.

What Are Potential Banks Seeking For Startups?

Two main types of banks look for startup opportunities. First, traditional commercial banks need startups to apply for new loans or existing companies for refinancing, depending on their needs. Second, there are venture capital firms that prefer to work with smaller startups that can present promising ideas for product development and innovation. While both processes can be highly competitive, some of the most reputable funding sources can be found simply by networking with people or organizations in your industry.

How Do They Approach It?

A company must first pass through the approval process to obtain a loan from a lender. At this stage, the lender decides whether the investment is financially viable. Once approved, a successful startup is required to follow specific guidelines and procedures. This includes submitting all the necessary documents, meeting compliance requirements, and keeping abreast of all applicable laws and regulations. Additionally, an eligible startup must maintain appropriate records of its activities, including accounting information, tax filings, cash flow statements, and other relevant financial data. Before applying for a loan from a bank, consider consulting with legal professionals and researching the type of lender, the interest rate, and any other critical details to ensure a smooth transition.

Types of Loans Available To Your Startup

There are different types of loans available to a successful startup. Here are some examples:

SBA Loans for Startups

SBA loans are secured from the U.S. Department of Agriculture (USDA). SBA loans allow startups to use low-interest rates and flexible repayment terms. As they are non-recourse loans, startup owner only needs to repay them once their business reaches profitability. In addition, the interest rate for SBA loans is much lower than interest rates offered by banks, so you do not need to worry about high interest rates compared to loans from banks.

However, if your startup starts operating after the approval of an initial decision, the startup would need to pay its principal and the interest. Moreover, startups would be required to meet minimum income thresholds, depending on the startup’s category. If a lender does not approve the application, the startup will also need to file an appeal, and it may incur penalties for non-compliance.

Business Line Finance Services LLC (BLF)

BLF offers financing services for middle- and small-sized businesses, startups, and partnerships. BLF provides loans ranging from $500-$10,000 on a 24-month basis. Depending on the borrower’s credit history and liquidity, the interest rate or term can be tailored to suit the specific needs of each borrower.

Banks typically offer the lowest interest rates on loans compared to alternative lenders, so if you want financing, go with BLF.

Conveyance Mortgage Corporation LLC (CMC)

CMC offers short-term bridge loans to entrepreneurs, sole proprietorships, corporations, and partnerships with the flexibility to customize your terms within the 5–25% range. You can choose between fixed interest rates or variable interests. CMC will provide complete payment protection for 90 days.

CMC loans are easy to qualify for if you complete the necessary paperwork and demonstrate proof of eligibility.

For example, suppose you have a projected net loss of $50,000 per quarter and expect to continue generating revenue over the next three years. In that case, you should submit documentation showing proof of earning capacity, positive working capital, and current revenues.

If the loan is deemed too large for you, you can request to reduce the loan size or cancel its implementation.

If you want to acquire crypto assets and diversify your portfolio, consider investing in stablecoins. Stablecoins are cryptocurrencies pegged to an underlying asset, such as the U.S. dollar, gold, or Ethereum (ETH). You can hedge against economic volatility or inflationary pressure by holding these assets. Stablecoins provide you with a haven asset in times of uncertainty, backed by either an actual physical asset or an equivalent digital token.

Stablecoins offer significant benefits, including increased security against monetary risks, reduced transaction fees, and greater accessibility to global markets. They may even make sense for users who plan to use their crypto assets to supplement their day-to-day finances — they are often used for trading. Additionally, they provide a good opportunity for retail traders — currently, only five fiat currencies are listed on significant exchanges, and thousands of altcoins and tokens are circulated. With the growing demand for stablecoins, one might expect that there will be further growth in the market in the future.


In conclusion, securing a loan from a reliable lender can significantly benefit your startup. Understanding the fundamentals of asset-based lending models and the types of loans available to startups can help you better understand the nuances of the process and mitigate any possible complications.

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