How common are debt-financed startups? I was under the impression that they were funded by equity, unless they were starting to show profits or had some assets.

How common are debt-financed startups? I was under the impression that they were funded by equity, unless they were starting to show profits or had some assets. In fact, a loan to a startup would behave like equity with a ceiling on appreciation, not like consumer debt. For whatever reason, I can't recall hearing about a single successful startup founder who previously declared bankruptcy. The closest I can think of was Bill Bartmann (http://www.businessweek.com/magazine/content/07_18/b4032066.htm?chan=search http://www.businessweek.com/magazine/content/07_18/b4032066....).