Glossary · Reading the business
In short
This metric represents a company's earnings before interest, taxes, depreciation, and amortization, further adjusted for non-recurring or discretionary expenses. It shows the core operating profitability for a new owner.
Adjusted EBITDA is a key metric lenders use to assess a business's cash flow and repayment capacity for an acquisition loan. Your CPA will help you calculate this by identifying and adding back discretionary expenses, owner's salary adjustments, and non-recurring items to the reported EBITDA. It's often the basis for valuation multiples.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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