I am part of a small tech startup, consisting of 4 people. I myself am a new PhD, with almost no credit history. However, the other 3 members are 50+ years old with a history of launching and running successful engineering or communications companies. We are starting our first round of funding, sending out a detailed business plan with a private placement documents. We're pretty confident in about $350k-500k in funds for our first round, based on recent companies the other members have worked on.
It could take until the end of 2017, however, to get some of that cash in hand. And I'm running into some money issues now. I receive a $2500 a month stipend from one of the members, but that barely covers rent, bills, and loan payments. I have equity options that I am not even close to exercising. Also, I could start developing a pretty finalized prototype system for $3000-4000 in parts, from plans I've already drawn up, but there's no capital at the moment for that either.
If I go the small business loan route… how are those decisions made? Is it based on the combined credit of all members… the average credit… the credit of the best member? Or is it based on the merits of the business plan? Or some combination?