The majority of businesses with no revenue fail before they ever bring in a single dime, which means normal lenders such as mainstream banks and even the SBA won’t lend you a single dime. However, there are still lenders who will lend to pre-revenue startups if you know where to look.
One of the best opportunities for pre-revenue startups to get loans is something most founders have never heard of: Community Development Financial Institutions (CDFIs). There are over 1200 CDFIs across all 50 states, DC, Guam, and Puerto Rico, and they exist to lend to startups, small businesses, co-ops & real estate development projects.
CDFIs can be local banks or credit unions, although most are nonprofits which exist solely to serve the role of CDFI. Some CDFIs are hyperlocal and may serve only a few hundred clients while others may serve millions through different branches or partner institutions.
Each CDFI has its own mission statement and targets a specific type of borrower. Many lend to startups and small businesses within a particular geographic area, some lend to businesses with social or sustainability impact, and some lend to minority or women founders. Often these institutions are very flexible on eligibility criteria so if you find one that you think might be relevant, it’s worth calling them to see if they can help you.
The second category of pre-revenue startup loan options is personal loans. Personal loans for business will have stricter credit and income requirements than CDFI loans, but if you have steady income from a current job, you should be able to leverage that into loan offers from personal loan providers. Then you can use that money for starting your own business and quitting your old job once your business is off the ground.
In this article, I’ve compiled the 12 best options for pre-revenue Florida startups I could find from both CDFIs and personal loan providers.
1. Ascendus Start-Up Loan
Loans up to $10,000 at low interest rates. Available anywhere in Florida and several other states.
Requirements
- FICO score of 575 of higher
- No more than $3,000 in unpaid / past due debt
- Any bankruptcy must be discharged for more than 1 year
- Any foreclosure must be complete for more than 2 years
- Business must be currently registered
- Owner must have a full or part-time job for at least 6 months and be able to provide the 2 most recent paystubs
Program Website: Ascendus Start-Up Loan
2. Lift Fund Small Business Loan
Loan amounts from $500 to $250,000. Loan maturity from 6 months to 10 years.
Requirements
- Founder is least 21 years old
- Founder is not involved in any active bankruptcy proceedings
- Founder has lived in an eligible state for at least 6 months (eligible states include Florida but also Texas, Georgia, Tennessee, Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Missouri, New Mexico, Oklahoma, and South Carolina)
- Startup is not involved in adult entertainment
- If business does not have revenue, then either founder must have sufficient income to cover loan payments (e.g. external job income, rental income, disability income, etc) or founder must apply with a co-borrower who has sufficient income to cover initial loan payments
I spoke with a representative who said that credit is considered flexibly. Typically they like to see applicants have at least a 575 credit score, but they are more interested in the activities leading to the credit score than the credit score itself, and they would rather see a low score that is increasing than a high score that is falling. The representative also said they are willing to work with individual borrowers with worse credit.
Email: info@liftfund.com
Phone: 888-215-2373
Loan Info Page: Lift Fund Loan Offerings
Loan Application (choose the “Small Business Loan” option if/when prompted): Lift Fund Small Business Loan Application
3. Upstart Personal Loan for Business
Loans from $1,000 to $50,000 are available to anyone with sufficient credit and income from a current job (the business to be started need not have any income itself).
Website: Personal Loan for Business Pre-Application
4. Ascendus Childcare Business Loan
Loans up to $20,000 are accessible in 48 hours with almost zero paperwork for licensed childcare professionals to start their own childcare business. Available throughout Florida (and several other states).
Requirements
- Must be a licensed family childcare provider (and have been licensed for at least 3 years)
- May have no credit, but if you have credit, your FICO score must be at least 575
Loan Program Webpage: Ascendus Childcare Loan
5. Broward Revolving Loan Fund Start-Up Loan
Loans from $10,000 to $50,000 for new businesses located in Broward Municipal Services District. The loan can be used to buy machinery or equipment, to finance tenant and real estate improvements, and to provide working capital.
Program Summary: Broward Revolving Loan Fund Program Announcement
Program Info: Broward Municipal Services District Revolving Loan Program Info & Application
6. Broward Revolving Loan Fund Microloan
Loans from $3,000 to $10,000 for businesses in Broward Municipal Services District that are at least 6 months old. Loan funds can be used for machinery, equipment, financing tenant and real estate improvements, and working capital.
Program Info: Broward Municipal Services District Revolving Loan Program Info & Application
7. Miami Bayside Foundation Minority Business Loan
Loans from $5,000 to $75,000 (and up to $150,000 in special circumstances).
Requirements
- Minority or women owned
- Owned by United States citizens or lawful permanent residents
- Domiciled in Miami-Dade County, as stated in the company’s occupational license
- For-profit S corporation, C corporation, or LLC. No sole proprietorships.
- Must demonstrate that the loan will aid in the creation of new jobs
- Must use funds for working capital, cash flow, inventory, and/or equipment
- For startups under 1 year old, owners must put up a 20% cash match
Specific Program Info: Minority-Owned Business Loan Program
Foundation Loan Programs Overview: Miami Bayside Foundation Loan Programs
8. Miami Bayside Foundation Black Business Loan
Loans from $5,000 to $75,000 (up to $150,000 in special circumstances).
Requirements
- 51% black-owned
- Owned by United States citizens or lawful permanent residents
- Domiciled in Miami-Dade, Broward, or Monroe Counties, as stated in the organization’s occupational license
- For-profit S corporation, C corporation, or LLC. No sole proprietorships.
- Must demonstrate that the loan will aid in the creation of new jobs
- Must use funds for working capital, cash flow, inventory, and/or equipment
- For startups under 1 year old, owners must put up a 20% cash match
Specific Program Info: Black Business Loan Program
9. OLCDC Small Business Loan (Startup Option)
Loans up to $250,000 from OLCDC (Opa-Locka Community Development Corporation).
Program Info: OLCDC Small Business Loan
10. Our Microlending Loans
Our Microlending LLC is a CDFI in Miami which provides loans of $3,000 to $50,000 for up to 24 month terms. They can provide loans even to tiny businesses with only a few hundred dollars in revenue, but they do normally require you to have been in business (even if the business is not registered) for at least 6 months and for some cashflow to have been generated during that time.
However, I spoke with a Microlending representative who said her organization is willing to work with founders of pre-revenue businesses in certain situations. Specifically, she said that if the founder had previously been employed in a related capacity, then they may be able to fund them. She gave an example of a woman who previously had a chair at a hair salon but wanted to start her own hair salon, and Microlending was able to work with her to finance that.
The rep also said that collateral and/or a co-borrower could help the application, and she emphasized multiple times that loans are decided case by case with a lot of flexibility.
Info Webpage: Our Microlending Loans
Phone: 305-854-8113
11. Partners for Self Employment Peer Loan
No credit, no collateral loans for entrepreneurs who are qualified residents of Miami Dade County. Loan amounts range from $1,000 to $5,000. You have the best chance of receiving the loan if you are either low income, a minority, or a person of color.
The loan details will be specific to your situation, and the website doesn’t have much useful info so the best way to get information is to contact someone by phone or email.
Phone: 305-438-1407
Email: success@partnersforselfemployment.org
12. Lending Club Personal Loan for Business
Loan amounts up to $40,000 for anyone with sufficient credit and income from a current job (but the startup business itself need not have any income).
Website: Lending Club Personal Loan for Business Pre-Application