Small Business Association Loan

Small business association loans range from $500 to $5.5 million and can be used for most business purposes, including the purchase of long-term fixed assets and working capital. SBA loans come with a few benefits including: competitive terms, counseling and education, lower down payments, flexible overhead requirements, and no collateral requirements. There are three main types of SBA loans: 7(a) loans, 504 loans and microloans.

Small Business Association (SBA)

The small business association (SBA) is a governmental organization that helps small businesses through capital injections (loans), guidance, counseling and mentorship, and contractual expertise. Often the SBA works with local chambers of commerce to connect new business operators with established business operators in the community. The SBA works to ignite change and spark action so small businesses can confidently start, grow, expand, or recover.

Small Business Innovation Research (SBIR)

The small business innovation research program is run by the SBA with the intent to help small businesses conduct research and development through contracts and grant funding.

Soft Landing

Soft landings, like acqui-hires, are the result of an acquisition. Unlike an acqui-hire though, in the event of a soft landing, the investors of the company basically get no money back. The goal is to “softly land” the employees and the assets, as the only other option is bankruptcy. Soft landings are sometimes the result of vulture capital.

Software as a Service (SaaS)

Software as a service (SaaS) refers to a business model in which a company sells cloud-based software (accessed via a browser or mobile app) at a monthly or annual fee. SaaS businesses are typically asset-lite, have high gross-margins, and are highly scalable. Examples of SaaS businesses include: Hubspot, Salesforce, Cloudflare, and Meta (Facebook). Most businesses that have a SaaS business model are a perfect fit for revenue based financing.

Software Startup

A software startup, is a business that develops, sells and distributes different types of software. They often have a SaaS business model, but occasionally have hardware components too. Examples of well-known software companies include Apple, Tesla, Google, and Dropbox. Software startups are a great fit for revenue based financing.

Stand-Alone Convertible Note

A stand-alone convertible note is intended for use by early-stage startups looking to raise seed capital from angel investors, friends, and family before receiving institutional funding from a venture capital firm. It contains all the terms of the agreement, including the borrowing mechanics, remedy in event of default, and valuation cap (if applicable).

Startup Advisor

A startup advisor is a subject-matter expert who provides industry or subject matter guidance and mentoring. They are typically well connected to investors and other industry professionals, to whom they provide warm introductions.

Advisors are usually compensated for their efforts either monetarily or through equity grants—ranging from 0.05% up to 1%. The ideal time to bring on an advisor is when you’re hiring key staff, pursuing strategic partnerships or ramping your sales.

Avoid bringing on an advisor who has:

  • No interest in your business or your mission
  • Minimal free time because they are overcommitted to other startups
  • A conflict of interest (i.e. advises a similar company in your industry)

Start-up Capital

Startup capital refers to any cash injection in an early stage business—typically the initial pre-seed round of a business is funded by friends and family, an angel group or an angel syndicate. As the startup matures, and offers additional rounds of funding venture capital funds and private equity funds invest. If the startup generates recurring revenues, another non-dilutive option to raise capital is revenue based financing.