{"ok":true,"canonical_url":"https://dealroom.so/glossary/capital-distribution","api_url":"https://dealroom.so/api/public/glossary/capital-distribution","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"capital-distribution","term":"Capital distribution","group":"Your money in the deal","definition":"Money paid out from a business to its owners or shareholders. As a buyer, you care about past distributions as they affect available cash flow and future distributions as part of your return.","what_it_means":"In an acquisition, examine the seller's historical capital distributions from the business. Excessive distributions might indicate insufficient reinvestment or an attempt to extract cash before sale, impacting the business's working capital. Project future distributions based on your expected cash flow after debt service. This is your personal return from the business.","url":"https://dealroom.so/glossary/capital-distribution","official_sources":[],"related":[{"slug":"cash-flow-after-debt-service","term":"Cash flow after debt service","url":"https://dealroom.so/glossary/cash-flow-after-debt-service"},{"slug":"working-capital","term":"Working capital","url":"https://dealroom.so/glossary/working-capital"},{"slug":"owner-earnings","term":"Owner earnings","url":"https://dealroom.so/glossary/owner-earnings"},{"slug":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"}],"related_questions":[{"question":"Can life insurance be used to ensure fair distribution of assets among non-active heirs in a family business?","url":"https://dealroom.so/sba-7a/questions/can-life-insurance-be-used-to-ensure-fair-distribution-of-assets-among-non-active-heirs-in"},{"question":"Are there specific limits on the amount of working capital that can be included in a 7(a) Working Capital Pilot Program loan?","url":"https://dealroom.so/for-lenders/questions/are-there-specific-limits-on-the-amount-of-working-capital-that-can-be-included-in-a-7-a-w"},{"question":"What kind of everyday expenses can working capital cover?","url":"https://dealroom.so/sba-loans/basics/what-kind-of-everyday-expenses-can-working-capital-cover"},{"question":"Can an SBA 7(a) loan finance working capital?","url":"https://dealroom.so/sba-7a/questions/can-an-sba-7-a-loan-finance-working-capital"},{"question":"What is the typical repayment term for working capital only?","url":"https://dealroom.so/sba-loans/basics/what-is-the-typical-repayment-term-for-working-capital-only"},{"question":"Can working capital be used for unexpected business expenses after closing?","url":"https://dealroom.so/sba-7a/questions/can-working-capital-be-used-for-unexpected-business-expenses-after-closing"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Capital distribution","url":"https://dealroom.so/glossary/capital-distribution","source_type":"DealRoom Data"}}