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At the risk of not answering the question, I'd say no form of capital is "better" than any other. Capital is a tool and the job of the founder is to find the option (both on payments term and other aspects like mentorship or personal exposure) that best aligns with their goals.

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Hey Tyler, thanks for responding.

Sure, I mean different forms of capital are better in different circumstances. So in which circumstances is the form of capital you're offering better than a 20-30% APR business loan?

Asking as a profitable bootstrapped SaaS founder.

We are mainly focused on the early stage when a business loan (ie no personal gaurantee) isn't an option. I went the route you described (racking up $50k credit card debt) to launch my SaaS business and it sucked. That said a business loan could be a great option for more mature businesses with solid cash flow (hopefully at much less than 20-30%!)

Two possible answers

1. When the business is too early stage to get a bank loan

2. When the business is highly risky and the founder doesn’t want the debt burden (not sure if Earnest would fund this either)

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