Glossary · Reading the business
In short
Cash flow represents the actual movement of cash into and out of a business. It's crucial because it shows if the business can generate enough money to cover its expenses, including loan payments.
When buying a business with an SBA 7(a) loan, you must understand the target's historical and projected cash flow. Lenders heavily rely on this to assess repayment capacity and ensure the business can service the new debt. Look at SDE or EBITDA for a clearer picture of owner earnings.
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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