Microfinancing is used to stimulate economic growth by providing small loans to those who are underserved by conventional lending. This type of financing is used worldwide, with loans smaller than $100 offered in some underdeveloped countries. Readers can use the following statistics to learn more about how microfinancing works and the populations it serves. The…
What Is a Convertible Note? Examples & How It Works
A convertible note is a short-term debt that has an interest or discount rate, a valuation cap, and a maturity date. Investors use convertible notes to invest in startups in the early stages of development. Investors can choose to convert convertible notes into preferred shares on a specific date or event. What Is a Convertible…
Equipment Lease Calculator
Our equipment lease calculator allows you to estimate the potential costs of an equipment lease by comparing three common lease options: a fair market value lease, $1 buyout lease, and 10% option lease. Estimate your monthly payment and total cost by changing key inputs like the interest rate, down payment, and length of the term….
Series A, B, C & D Funding Rounds Explained
Series A, B, C & D investments represent the first funding rounds that startups receive from investors. Each round involves the issuance of preferred stock sold to investors by a startup, with subsequent letters representing subsequent rounds. Startups use these funding rounds to hire staff, launch products, and market to customers. What Series A, B,…
What Is the Prime Rate: How it Works, Definition & Formula
The prime rate is an interest rate set by banks representing the lowest interest rate at which a bank will lend money to its most creditworthy borrowers. It is highly correlated to the Federal Funds Target Rate set by the Federal Reserve. The current prime rate, published by the Wall Street Journal, is 3.25%. Current…
Self-storage Loans: The Ultimate Guide to Self-storage Financing
Self-storage financing is used to finance the purchase, renovation, or construction of self-storage units and commercial real estate buildings. The most popular self-storage loans are conventional bank loans, SBA 7(a) loans for commercial real estate, and SBA 504 loans. Other alternative loan options exist but typically are meant for short-term financing. is one of the…
Borrowing Base: What it is & How to Calculate
Borrowing base is a metric determined by the value of assets you have available to pledge as collateral for a loan. It is equivalent to the maximum loan amount a lender will offer based on a given set of assets. The total asset value is multiplied by the lender’s discount rate to determine the borrowing…
Startup Business Loans 2020: The 12 Best Ways to Fund Your Startup
Qualifying for a business loan as a startup can be difficult. Entrepreneurs often need to utilize multiple financing sources to get their new startup off the ground. Startup business loans can take many forms, including SBA loans, angel investment, or Rollovers for Business Startups (ROBS), and each is unique in what they offer to startups….
Equipment Loans – How They Work & Where to Find One
Equipment loans help businesses finance equipment such as vehicles and heavy machinery and are secured by the asset being financed. Equipment loans are available from a variety of providers, including traditional banks and alternative lenders. Rates typically range from 6% to 9%, depending on qualifications, and lenders generally charge origination fees between 1% and 3%….
Business Auto Loans: The 7 Best Lenders Compared
Business auto loans offer companies the opportunity to finance vehicles to complete a job, transport employees, and bring customers to their business. Traditional and online lenders offer commercial auto loans with varying minimum requirements, repayment terms, and funding amounts. We conducted an auto loan comparison based on these criteria and selected seven top options. Top…
How to Get a Loan to Buy a Business
Most people need a loan to buy a business. Borrowers should expect a down payment starting at 10%, interest between 5% and 10%, and terms between three and 25 years. Most loans have underwriting or closing costs, and borrowers should expect to pay on average 2% to 3% of the total loan amount at closing….
Apple Business Financing: How it Works & Compares to Other Lenders
Apple business financing is an equipment lease that lasts 12 to 36 months and is available to businesses on transactions starting at $4,000. Two lease types are available—fair market value (FMV) and $1 buyout—based on whether you intend to keep the equipment or trade it in at the end of the lease. Apple Business Financing…