Top Tips to Get a Startup Business Loan With No Money

Uzone.id — Starting a business is tough enough, but trying to do it with no money? That sounds like a mission impossible. But, it is not impossible at all, because the answer is a yes, you can.

Getting a startup business loan when you’re broke isn’t impossible — you just need to know the right moves and know that this type of business loan can be incredibly challenging and lead to you paying more in the long run. 

“Because your business is not generating revenue (yet), you’re starting off as a riskier investment. So, your goal when pursuing a startup business loan is to minimize risk in the eyes of the lender,” said Noah Parsons, COO at Palo Alto Software.

Here’s how you can still land that startup business loan and turn your dream into reality.

Have a solid business plan. No brilliant plan means no money

Actually, if we’re going to be real, no one’s going to hand you money if you don’t know how you’re going to spend it.

But you can think like this: your business plan is the key to unlocking that loan.

Even if your bank account is dry, a detailed business plan is proof to lenders that you’re serious. It’s your roadmap that lays out what your business is, how it’s going to make money, and how you’ll repay the loan.

Lenders need to see that you’ve thought things through. A well-structured business plan is essential because it shows how their money will be used and what return on investment they can expect.

What to include in your business plan: Your business concept and goals, market research (who’s your competition?), financial projections (how much money you plan to make), how you’ll use the loan, plan for paying it back.

Use your credit wisely, your credit score is matter

No money? No problem — but bad credit? That is a problem.

Your credit score can break your chances of getting a loan, especially if you’re starting out with zero capital. That’s why, good score matters.

Lenders want to see that you’re responsible with money, so if your personal credit score is good, you’ll have a good chance at securing that loan.

According to Experian, the average small business loan borrower has a credit score of 680 or higher. If you’re below that, work on building it up by paying off debts and keeping your credit usage low.

So, what should we do if your credit isn’t great? Just focus on improving your credit before applying, try getting a co-signer with good credit and look into alternative lenders (like online loan platforms).

Consider a microloan, small loans can make a big impact

If you’ve got no money, you don’t need a huge loan to get started. Microloans could be your solution. 

Microloans are more accessible than large business loans and come with reasonable interest rates. Plus, since the amounts are smaller, lenders take on less risk, making it easier for you to get approved.

These are small loans (typically under USD 50,000) aimed at new businesses and entrepreneurs who don’t qualify for traditional loans. They’re often easier to get, even if you’re working with no initial capital.

The U.S. Small Business Administration (SBA) is a big player in microloans. According to their stats, the SBA has helped thousands of startups secure funding through their Microloan Program. 

Crowdfunding: let the people fund you

Crowdfunding has become a popular way to raise money for startups, especially when traditional loans aren’t an option. 

In fact, crowdfunding has generated billions for startups globally. It’s a win-win: you get the money you need without taking on debt, and your crowdfunder gets to support something they believe in. If you succeed with this campaign, lenders will get you on their radar.

Try a business line of credit, flexibility is key

A business line of credit is another option if you don’t have upfront cash. Think of it like a credit card for your business — you get access to a certain amount of money, but you only use (and pay interest on) what you need. It’s perfect for businesses that need flexibility to manage cash flow.

You’re not locked into a fixed loan amount, and you have more control over how and when you use the funds. It’s especially helpful for managing short-term expenses.

Getting a startup business loan with no money isn’t impossible — it just takes some strategy. Whether you go the traditional route with microloans or take advantage of crowdfunding, there are plenty of ways to secure funding without a fat bank account. So, try to give it a shot!