Getting Funded 120414

Published on December 6th, 2016 | by Jose Vasquez

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Is It Possible to Start a Business While in Debt?






Starting a business while deep in debt is inadvisable in most circumstances, but is it possible?

You want to live the life of an entrepreneur. Maybe you want to take lead of a team, maybe you want more freedom, maybe you want the chance to earn lots of money, or maybe you just want to create something cool. In any case, you’ll need money to do get started.

But what if you’re currently suffering from a ton of debt? You could be paying back loans, or major credit card debt, or maybe you’re dealing with the financial fallout of another businesses failure. If you’re in debt, is it even possible to start a business?

The Importance of Fiscal Responsibility

It’s important that you realize the importance of personal fiscal responsibility when it comes to starting a new business:

  • Your credit history will affect whether you can get new loans, open new lines of credit, and may even affect how advisors and potential investors see you as a businessperson. Debt or no debt, your credit needs to be in good shape.
  • You may be going without a salary for the first several months to the first few years of business. If you’re in debt, can you afford to take that financial risk?
  • It should go without saying that most businesses need a capital injection to get started. If you’re heavily in debt, you won’t have any cash to front yourself, leaving you to rely on outside sources for the bulk of your investment—which means you may lose some control over your business or be forced to spend more time fishing for investors.

Not All Startups Are Hungry for Cash

However, you should also be aware that not all startups are desperately hungry for cash. In fact, there are hundreds of businesses that you can start with just a few hundred dollars, and keep running for the first few months without any additional investment. If you’re struggling with debt, these may be your best options.

The Bottom Line

Being deeply in debt makes it harder to launch a startup, but not impossible. You’ll need a good credit history and some access to capital, and you need to be willing to take a huge financial risk in your personal life—but if you know and accept those realities, there’s nothing stopping you from building a business even when sacked with debt.


About the Author

is a serial entrepreneur and tech specialist dedicated to helping startup tech companies grow and succeed. As the founder of Build. Brand. Blast., Jose has worked with dozens of enterprises to find direction, gain momentum, and achieve results.



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  • Meet Jose Vasquez



    Hey there! I’m Jose Vasquez, and I’ve spent my life helping startup technology companies get the direction and momentum they need to succeed. I started Build. Brand. Blast. as a resource for new entrepreneurs to learn the ropes of starting a business and the keys to building something that lasts.

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