Glossary · Reading the business
In short
When a business spends more cash than it brings in over a period. This is a critical red flag, indicating the business cannot cover its expenses, including debt service.
A business with negative cash flow cannot support debt. Lenders will look closely at cash flow projections and historical performance. If the business consistently generates negative cash flow, an SBA loan is highly unlikely, as it indicates a lack of repayment capacity. Dig deep into the reasons why this is happening.
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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