Glossary · Reading the business
In short
The SBA's process of evaluating if a business meets its "small business" definition, primarily based on revenue or employee count. This is a strict eligibility requirement for a 7(a) loan.
The SBA sets size standards by NAICS code. Your lender will perform a size determination, which includes evaluating potential affiliations. If the business, when combined with any affiliated entities, exceeds the revenue or employee threshold for its industry, it's ineligible for an SBA loan. Ensure all ownership and affiliation details are accurate.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
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.
Free · No documents · Usually same-day