{"ok":true,"canonical_url":"https://dealroom.so/glossary/investment-business","api_url":"https://dealroom.so/api/public/glossary/investment-business","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":"investment-business","term":"Investment business","group":"The loan itself","definition":"A business primarily engaged in investing, lending, or speculating. The SBA generally considers these ineligible for 7(a) loans because they don't produce goods or services.","what_it_means":"If the target business is mainly making investments rather than operating a trade, it's ineligible for an SBA 7(a) loan. Lenders will scrutinize the business's primary activity to ensure it qualifies.","url":"https://dealroom.so/glossary/investment-business","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"passive-entity","term":"Passive entity","url":"https://dealroom.so/glossary/passive-entity"},{"slug":"ineligible-businesses-rule","term":"Ineligible businesses rule","url":"https://dealroom.so/glossary/ineligible-businesses-rule"},{"slug":"active-involvement","term":"Active involvement","url":"https://dealroom.so/glossary/active-involvement"}],"related_questions":[{"question":"Can I get an SBA 7(a) loan for a real estate investment business?","url":"https://dealroom.so/sba-loans/basics/can-i-get-an-sba-7-a-loan-for-a-real-estate-investment-business"},{"question":"Can a business primarily engaged in lending or investment be eligible for a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/can-a-business-primarily-engaged-in-lending-or-investment-be-eligible-for-a-7-a-loan"},{"question":"Can the seller's investment in the business immediately prior to sale count towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/can-the-seller-s-investment-in-the-business-immediately-prior-to-sale-count-towards-my-equ"},{"question":"Are proceeds from personal investment sales eligible for equity injection?","url":"https://dealroom.so/sba-7a/questions/are-proceeds-from-personal-investment-sales-eligible-for-equity-injection"},{"question":"What documentation verifies funds for equity injection transferred from a personal investment account?","url":"https://dealroom.so/for-lenders/questions/what-documentation-verifies-funds-for-equity-injection-transferred-from-a-personal-investm"},{"question":"Can proceeds from the sale of my existing investment property count towards my equity injection for a $1,500,000 business purchase?","url":"https://dealroom.so/sba-7a/questions/can-proceeds-from-the-sale-of-my-existing-investment-property-count-towards-my-equity-inje"}]},"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 — Investment business","url":"https://dealroom.so/glossary/investment-business","source_type":"DealRoom Data"}}