Pretend that a batch of YC startups are all getting loans rather than ownership purchases. What effective interest rate are they paying? What is the default rate where the startup dies before acquisition/profitability/IPO?
Write a heuristic to determine a fair interest rate given the current prevailing rates, financial history of the company in question, financial history of similar companies, and similar objective and quantifiable subjective factors. Document it. When someone complains, demonstrate to your regulator that your procedure was fair, reasonable, and applied evenhandedly, and to the extent possible is consistent with actual outcomes.
I'm not sure what you're getting at here. Any new batch of startups is so risky, I can't imagine a bank lending them a cent at any non-usurious interest rate until they've been in business for a few years.
Sure, but not without a personal guarantee from one or more of said executives, I would imagine. At that point, it's effectively the bank lending the money to the exec though, and not lending to the company.
Pretend that a batch of YC startups are all getting loans rather than ownership purchases. What effective interest rate are they paying? What is the default rate where the startup dies before acquisition/profitability/IPO?
Write a heuristic to determine a fair interest rate given the current prevailing rates, financial history of the company in question, financial history of similar companies, and similar objective and quantifiable subjective factors. Document it. When someone complains, demonstrate to your regulator that your procedure was fair, reasonable, and applied evenhandedly, and to the extent possible is consistent with actual outcomes.