Bridge loan

Also known as a swing loan, this is a short-term loan that facilitates gaps in funding to meet current obligations before a company is able to secure permanent financing. It gives a company immediate capital when funding is needed but is not yet readily available. It typically does not take longer than 12 months, but it usually comes with a high interest rate and must be backed by a kind of collateral, such as business inventory.

Previous: Bootstrapped Next: Cashless exercise