{"ok":true,"canonical_url":"https://dealroom.so/glossary/startup-business","api_url":"https://dealroom.so/api/public/glossary/startup-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":"startup-business","term":"Startup business","aka":"Startup","group":"Reading the business","definition":"A startup business is a newly established company, typically with less than two years of operating history. While SBA 7(a) loans can fund startups, they are much harder to finance for acquisitions due to lack of historical performance.","what_it_means":"For a 7(a) loan, lenders prefer businesses with a proven track record (at least two to three years) to demonstrate repayment capacity. An acquisition of an existing, profitable business is generally viewed more favorably than a true startup. If the business you're buying has less than two years of solid financials, expect significant lender skepticism and potentially higher equity injection requirements.","url":"https://dealroom.so/glossary/startup-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":"future-earnings","term":"Future earnings","url":"https://dealroom.so/glossary/future-earnings"},{"slug":"financial-projections","term":"Financial projections","url":"https://dealroom.so/glossary/financial-projections"},{"slug":"business-plan","term":"Business plan","url":"https://dealroom.so/glossary/business-plan"},{"slug":"underwriting","term":"Underwriting","url":"https://dealroom.so/glossary/underwriting"}],"related_questions":[{"question":"Are SBA 7(a) loans only for very small, startup businesses?","url":"https://dealroom.so/sba-loans/basics/are-sba-7-a-loans-only-for-very-small-startup-businesses"},{"question":"Are SBA 7(a) loans mainly for startup businesses, or also for existing ones?","url":"https://dealroom.so/sba-loans/basics/are-sba-7-a-loans-mainly-for-startup-businesses-or-also-for-existing-ones"},{"question":"Is an SBA 7(a) loan only for existing businesses, or can a new startup get one?","url":"https://dealroom.so/sba-loans/basics/is-an-sba-7-a-loan-only-for-existing-businesses-or-can-a-new-startup-get-one"},{"question":"What if the business I'm acquiring is a startup with limited operating history?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-m-acquiring-is-a-startup-with-limited-operating-history"},{"question":"Is it harder to get an SBA 7(a) loan for a brand new startup business?","url":"https://dealroom.so/sba-loans/basics/is-it-harder-to-get-an-sba-7-a-loan-for-a-brand-new-startup-business"},{"question":"What are the main advantages of an SBA 7(a) loan for a new business or startup?","url":"https://dealroom.so/sba-loans/basics/what-are-the-main-advantages-of-an-sba-7-a-loan-for-a-new-business-or-startup"}]},"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 — Startup business","url":"https://dealroom.so/glossary/startup-business","source_type":"DealRoom Data"}}