SBA 7(a) Q&A
Short answer
For a start-up acquisition, the minimum equity injection required by the SBA is typically higher, often 25-30%, compared to 10% for established businesses.
While the general minimum equity injection for an acquisition is 10%, the SBA often requires a higher injection for new businesses or acquisitions that are deemed 'start-ups' due to lack of historical performance under the new ownership. This higher percentage reflects increased risk and the need for stronger borrower commitment.
A buyer is acquiring a business that has been operating but will be completely rebranded and moved to a new location, essentially functioning as a startup under new management for a purchase price of $500,000. The lender, following SBA guidance for higher-risk scenarios, may require a 25% or $125,000 cash injection.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
7(a) Loan Program — Terms, Conditions, and Eligibility
U.S. Small Business Administration · Official SBA source
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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