Startup Business Loans: An Honest Guide for Brand-New Businesses
If your business is brand new, the honest answer is that your options are narrower than the ads suggest. Here is what a pre-revenue or very young U.S. business can realistically look at today, how to build the record that opens more doors, and how to tell when it is time to come back.
By States Funding Team · Published
Why we are telling you to slow down
States Funding is not a lender. It runs a platform that matches U.S. small and medium businesses with funding offers from independent third-party lenders, and those lenders decide approval, rates and terms. That matters here, because the typical floors to apply through States Funding are about 6 months in business and $10K or more in monthly revenue, according to its About page. Its FAQ adds a 500+ FICO score to that typical floor for its small business loan and revenue-based financing products.
If you are not there yet, applying now is unlikely to be the best use of your time. We would rather tell you that up front and point you to options that are actually built for startups. If you are already past those floors, skip ahead to the section on coming back, and remember that meeting a floor is not a promise of an offer.
Find your stage
“Startup” covers everything from a business plan on a laptop to a shop that has been open for five months. The realistic options change a lot across that range, so start by placing yourself honestly.
| Your stage | The reality | What to look at |
|---|---|---|
| Idea or pre-revenue | No sales history yet, so there are no business deposits to show anyone. | SBA microloans through intermediary lenders. Ask each intermediary whether it works with businesses that have not opened yet. |
| Open, under about 6 months | Some deposits, but a short record. You are below States Funding’s typical floor of about 6 months in business. | SBA microloans, plus the record-building steps below. Ask any other lender directly what history it looks for. |
| About 6 months or more, $10K+ a month in revenue | You have reached States Funding’s typical floors. That is a starting line, not an approval. | Compare offers from independent lenders, alongside any microloan or bank options you are already exploring. |
The startup-friendly option: SBA microloans
According to the SBA, its microloan program provides loans up to $50,000 to help small businesses and certain not-for-profit childcare centers start up and expand. The SBA says the average microloan is about $13,000, and that microloans are provided by intermediary lenders. The words “start up” are in the program’s own description, which is why it belongs at the top of a new owner’s list.
Two things to keep in mind. First, you apply through an intermediary, not through the SBA and not through States Funding. Second, a program maximum is not what any one business will get. Plan around what you actually need, and use the average as a reminder that many microloans are modest in size.
When you talk to an intermediary, these questions will save you a second phone call:
- Do you lend to businesses that have not started selling yet?
- What will you want to see from me: a plan, projections, personal financial information, something else?
- Is there anything about my industry or my ownership that would be a problem?
For a full walk-through of the program and how to find an intermediary, read our SBA microloan guide.
What about a bigger SBA 7(a) loan?
It is worth knowing where 7(a) stands for a business that has not opened. The SBA lists seven eligibility requirements for 7(a) loan assistance, and the first is that the business must be an operating business. The others are that it operates for profit, is located in the U.S., is small under SBA size requirements, is not a type of ineligible business, cannot obtain the desired credit on reasonable terms from non-federal, non-state and non-local government sources, and is creditworthy and can demonstrate a reasonable ability to repay.
More broadly, the SBA says lenders and loan programs have unique eligibility requirements, and that eligibility generally depends on what a business does to receive its income, the character of its ownership and where it operates. If you are still at the idea stage, ask a 7(a) lender how it reads “operating business” before you put hours into an application. Our guide to SBA loan requirements goes through each item.
Build the record that opens more doors
While you wait for months to pass, you can make those months count. None of these steps guarantees anything, but they leave you with a clear story to show when you do apply.
- Run every sale through one business bank account. When you later apply through States Funding, you can connect that account through Plaid, which States Funding uses so it never stores your bank login, or upload the last four months of statements. Keeping personal spending out of that account makes your own record easier to follow. Lenders may ask for more during their own review.
- Get your paperwork in one folder. Your EIN, formation documents, ownership split and any licenses your work needs. Ask each lender which of these it will want.
- Know your personal credit. Applying and comparing offers through States Funding uses a soft credit pull only, with no impact to your credit score, and only the final acceptance step needs a brief credit unlock for the lender. Individual lenders may run their own checks before funding, so know where you stand.
- Track monthly revenue, not just your best month. A simple tracker shows you when you are consistently above a floor rather than above it once.
- Write down what the money is for. Equipment, inventory, a first hire, a cash cushion. Knowing the answer now lets you ask each lender which of its products fits that purpose.
An illustrative revenue tracker
Here is what step four might look like for a made-up business. These numbers are illustrative only and are not a benchmark for any industry.
| Illustrative month | Business deposits |
|---|---|
| Month 1 | $3,200 |
| Month 2 | $5,800 |
| Month 3 | $7,400 |
| Month 4 | $9,100 |
| Month 5 | $10,600 |
| Month 6 | $11,300 |
In this illustrative example, the business crosses the $10K line in month five and stays there in month six. That is the moment to start comparing options, not the moment it first had a good week. Even then, independent lenders decide, and they may look at things a tracker does not show.
Set expectations with real data
The Federal Reserve Banks’ 2025 Small Business Credit Survey of employer firms found that 60% of firms applied for financing in the prior 12 months. Among applicants, 42% received the full amount they sought, 36% received some or most, and 22% received none. The survey covers employer firms and is a convenience sample, so it is not a picture of every startup, and it says nothing about States Funding results. The useful lesson is simple: build a plan that still works if you receive less than you ask for, or nothing on the first try.
When to come back, and what you can compare then
Come back when most of these are true:
- You have been operating for about 6 months or more.
- Your monthly revenue has been at or above $10K for more than one month.
- Your business deposits run through one account you can connect or export.
- You know what the money is for and the smallest amount that would still do the job.
At that point, offers through States Funding’s lender network cover business lines of credit, small business term loans, revenue-based financing, invoice financing and non-dilutive capital. There is no guarantee that applying leads to an offer, that an offer will be accepted or that funding closes by any date. Any offer you see is non-binding until you e-sign a funding agreement directly with the lender, and that agreement governs the loan, fees and repayment. The actual lender written terms govern, so read them closely. You can read how States Funding works now, and start an application once your tracker says you are ready.
Sources
This guide is general information for U.S. business owners, not financial, legal or tax advice. States Funding is not a lender. Loans, advances and other financing products are originated and serviced by independent partner lenders, and States Funding does not guarantee that any application will result in an offer. Any examples are illustrative. The actual lender written terms govern any offer you receive.