Start-Up Venture


Venture Financing

The 4 C's of Commercial Lending

How To Obtain a Commercial Loan for Your Start-Up Venture

By Venture Planning Associates

  1. Concept:  What you are selling the banker on, what exactly is involved in the business situation, such as the type of service, management expertise, and marketing strategies. Some industries are off limits or not currently supported by lending institutions. It is important that you know the current status of your industry. 

  2. Cash Flow:  Prove that there is cash available to repay the loan.  Prepare a business plan that shows an equal balance of equity from principals, equity from outside investors and equity equivalents (build out allowances, supplier financing or flooring, etc.) in place.  Then have your business plan always have a coverage ratio for interest and principal of 1.3 or greater.

  3. Collateral:  Banks aren't venture capitalists or equity participants.  However, some banks in Silicon Valley and other high tech areas will co-investor, or lend money for startups is there is already a known venture capital company or other major investor.

  4. Character:  What are the credentials of the parties requesting the loan? Do they have positive track records in this industry, do they have positive banking relationships in the community, and are they known quantities?


Obtaining a Loan for Your Business: Dealing with Banks

What Does the Bank Look for:12 Questions

Documentation Required to Process a Commercial Loan

Cash Flow Analysis and Forecast

Balance Sheet

Profit and Loss Statement

Venture Financing

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What Are the Venture Capitalists' Investment Criteria?

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Business Plan

Start-Up Business Plan

Business Plan DOs and DON'Ts

How Investors Read a Business Plan

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Management Team

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Venture Financing





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