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Tech Industry

Gateway expands lease program for start-ups

The computer maker plans to expand its leasing program to target e-businesses too young to qualify for traditional lending programs.

    While some companies might be thinking twice about extending additional credit to new Internet companies, Gateway plans to expand its leasing program to target e-businesses too young to qualify for traditional lending programs.

    Gateway plans to announce on Monday its eBusiness Accelerator Leasing program, an initiative that would lease up to $1 million in computing gear and services to new Internet companies that have at least one round of funding.

    "Many customers that are in this niche don't fit the conservative standards, such as having been in business for two or three years," said Tony Montemurro, senior manager of Gateway's business finance program.

    Expanding its business leasing program is part of Gateway's efforts to expand "beyond the box" revenue. The move also comes after Gateway posted disappointing results for its business unit.

    To decide whether a company gets financing--and how much--Gateway will take a look at a company's executive team, funding and financial performance. Companies chosen will get from $10,000 and $1 million worth of products financed over anywhere from one to five years.

    In some cases, Gateway may make getting a stake in the company a condition of lending. Still, Montemurro said the program is more lenient than ones from rivals such as Compaq Computer because there are no membership fees or commitments to a particular platform.

    Montemurro said the program was spurred, in part, by the current downturn in funding for Internet ventures. More customers were asking for help, he said.

    "We certainly see customers and prospective customers on a daily business whose models we believe in," he said. "We'd really like to help them through the hiccup."

    Gateway apparently is comfortable with the added risk.

    "They have a (risk structure) that, based on all of our analyses, we're comfortable with," Montemurro said.