{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/does-the-value-of-intellectual-property-i-already-own-personally-count-towards-my-equity-i","api_url":"https://dealroom.so/api/public/questions/does-the-value-of-intellectual-property-i-already-own-personally-count-towards-my-equity-i","question":"Does the value of intellectual property I already own personally count towards my equity injection?","topic":"What counts toward the 10%","audience":"borrower","bot_mode":"buyer","short_answer":"Yes, personally owned intellectual property can count towards equity injection if it is essential to the acquired business and properly valued.","rule":"Similar to other tangible assets, intellectual property (IP) owned by the borrower can be contributed as part of the equity injection if it is critical to the success of the acquired business. The IP must be appraised by an independent, qualified appraiser to determine its fair market value, and all legal rights must be transferred to the business.","example":"A buyer acquiring a software development firm personally owns a patent for a critical algorithm. If independently appraised at $75,000 and transferred to the acquired business, this value can be part of the buyer's equity injection for a $750,000 purchase requiring $75,000 equity.","what_lenders_check":"Lenders will focus on the IP's relevance to the business, its accurate and independent valuation, and the proper legal transfer of ownership to the borrowing entity. They must ensure the IP is free of encumbrances.","required_facts":["Personally owned IP","Essential to business","Independent appraisal","Legal transfer of rights"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans","7(a) Loan Program Terms, Conditions, and Eligibility"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"},{"title":"7(a) Loan Program Terms, Conditions, and Eligibility","url":"https://www.sba.gov/partners/lenders/7a-loan-program/terms-conditions-eligibility"}],"related_questions":[{"question":"Can renovation costs for an acquired business premises count towards my required 10% equity injection?","url":"https://dealroom.so/sba-7a/questions/can-renovation-costs-for-an-acquired-business-premises-count-towards-my-required-10-equity"},{"question":"Can the fair market value of equipment I already own and contribute to the acquired business count towards my equity?","url":"https://dealroom.so/sba-7a/questions/can-the-fair-market-value-of-equipment-i-already-own-and-contribute-to-the-acquired-busine"},{"question":"Can sweat equity or future services I provide to the business count towards the required equity injection?","url":"https://dealroom.so/sba-7a/questions/can-sweat-equity-or-future-services-i-provide-to-the-business-count-towards-the-required-e"},{"question":"Are pre-closing legal and accounting fees eligible to be counted towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/are-pre-closing-legal-and-accounting-fees-eligible-to-be-counted-towards-my-equity-injecti"},{"question":"Besides cash, what non-cash assets can I contribute to meet the 10% equity injection for an $800,000 acquisition?","url":"https://dealroom.so/sba-7a/questions/besides-cash-what-non-cash-assets-can-i-contribute-to-meet-the-10-equity-injection-for-an-"},{"question":"Can a substantial pre-paid rent deposit on a commercial lease count towards the equity injection for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/can-a-substantial-pre-paid-rent-deposit-on-a-commercial-lease-count-towards-the-equity-inj"}],"related_terms":[{"term":"Intellectual property","url":"https://dealroom.so/glossary/intellectual-property"},{"term":"Intellectual Property Asset","url":"https://dealroom.so/glossary/intellectual-property-asset"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-equity-injection"},{"term":"Tangible Equity Injection","url":"https://dealroom.so/glossary/tangible-equity-injection"},{"term":"Hidden Equity Injection","url":"https://dealroom.so/glossary/hidden-equity-injection"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-14","sba_rule_sources_checked_through":"2026-06-14"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/does-the-value-of-intellectual-property-i-already-own-personally-count-towards-my-equity-i","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}