I've worked in small start ups before, but all boot strapped out of pocket / revenue. Wouldn't having to borrow money constantly be a red flag that the business is bad / not profitable?
Interesting, I can see this as lending implies some due diligence into a companies financials. At the same time, at the personal level, I know I can get lines of credit that would be very tough for me to pay back. Is corporate borrowing much more stringent?
Depends. If your income comes in 90 days post invoice, but you pay monthly then borrowing some money to smooth over cash flow makes loads of sense. If you need to buy loads of stuff to sell, it also makes sense. Software businesses are pretty weird in the lack of capital costs.
