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What are typical bridge loan terms for start-ups?

A start-up has a cash flow issue for the next few months. They have signed contract work with major payments coming in at the end the next quarter (about 4 months out), but need a little bit of money to make it there. I've been in discussions with them on providing this loan to them, but neither of us have done this before. Most of the examples I see are regarding real-estate. Both sides of the table want to be fair, but it is hard to find anything to draw on. We are mostly looking for numbers on cash and interest, nothing with convertible debt. Also, ideas on collateral or other loan backing?

Answers

Topic Expert
Linda Wright
Title: Consultant
Company: Wright Consulting
(Consultant, Wright Consulting) |

Unfortunately, you sound like a prime + client and may need to pledge AR, equipment or personal property to get it done.

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