Glossary · Doing the deal
Minority Stake
In short
Ownership of less than 50% of a company, meaning you don't have controlling interest. For a small business acquisition, you typically want to buy 100% or a controlling majority.
What it means in a deal
SBA 7(a) loans are generally for acquiring a controlling interest, meaning at least 51% ownership. If you're considering a minority stake, it's usually not eligible for a standard 7(a) loan unless it's a specific type of partner buyout where you become the controlling owner. Be clear on your ownership percentage and control.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Minority Stake
- When can a minority equity stake still create affiliation for size purposes?
- When does a minority equity stake still create affiliation for size purposes?
- When does a minority equity stake still create affiliation for SBA size purposes?
- Can an SBA 7(a) loan finance a partial buyout where the seller retains a minority stake?
- What if the seller remains as a passive investor with a minority equity stake in an acquisition?
- Does the SBA permit a seller to retain a minority ownership stake while holding a standby note?
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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