Glossary · Reading the business
In short
This is the difference between what a buyer is willing to pay and what a seller expects for a business. It commonly arises when their perceptions of value do not align.
A valuation gap frequently occurs when the seller's asking price, often influenced by subjective factors or future hopes, exceeds the buyer's objective assessment derived from due diligence and a professional business appraisal. You can often bridge this gap by structuring the deal with tools like a seller note or an earnout, tying part of the purchase price to future performance.
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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