Glossary · Reading the business
In short
This is the rate at which a business is spending its available cash, typically when it's operating at a loss. It tells you how long the business can survive before running out of money.
For an acquisition, analyzing the target business's burn rate is critical, especially if it's not yet profitable or has high startup costs. A high burn rate indicates financial risk and requires a clear plan for achieving profitability quickly. Ensure your cash flow projections account for this.
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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