{"ok":true,"canonical_url":"https://dealroom.so/glossary/working-capital","api_url":"https://dealroom.so/api/public/glossary/working-capital","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":"working-capital","term":"Working capital","group":"Reading the business","definition":"Cash the business needs on hand to operate — payroll, inventory, the gap between paying suppliers and getting paid.","what_it_means":"Working capital is the operational buffer that keeps a business running day to day. If your new business pays suppliers before customers pay you, you need cash in between — that gap is your working capital need. SBA 7(a) loans can include a working-capital component as part of the deal structure, but lenders will scrutinize the amount. Show up to closing with at least one month of operating expenses in liquid reserves beyond your injection.","url":"https://dealroom.so/glossary/working-capital","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"}],"related":[{"slug":"out-of-pocket","term":"Out of pocket","url":"https://dealroom.so/glossary/out-of-pocket"},{"slug":"total-project-costs","term":"Total project costs","url":"https://dealroom.so/glossary/total-project-costs"},{"slug":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"slug":"cash-flow-after-debt-service","term":"Cash flow after debt service","url":"https://dealroom.so/glossary/cash-flow-after-debt-service"}],"related_questions":[{"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"},{"question":"What does 'working capital' mean for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-does-working-capital-mean-for-an-sba-7-a-loan"}]},"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 — Working capital","url":"https://dealroom.so/glossary/working-capital","source_type":"DealRoom Data"}}