Glossary · Your money in the deal
Capital Contribution(Equity injection)
In short
This is the cash you put into the deal yourself, distinct from the SBA loan. Lenders want to see you have skin in the game, demonstrating your commitment to the business.
What it means in a deal
For a 7(a) loan, you generally need to inject at least 10% of the total project costs as equity. This often comes from your personal savings or a seller note on full standby. It's not just a number; it's a demonstration of your commitment and ability to manage risk.
Official sources
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.
Related terms
Common questions about Capital Contribution
- Can the seller's contribution of working capital count towards my minimum equity injection?
- Can an institutional investor's cash contribution count towards my SBA 7(a) equity injection?
- What is the typical down payment or equity contribution required for an SBA 7(a) loan?
- Can a seller note be used to finance the entire seller's equity contribution to the buyer's business?
- Are there specific limits on the amount of working capital that can be included in a 7(a) Working Capital Pilot Program loan?
- What kind of everyday expenses can working capital cover?
Defined by CapBench 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.
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