Glossary · Your money in the deal
Net equity
In short
This is the value of your ownership stake in the business after subtracting all liabilities. It represents the true value you own.
What it means in a deal
In an acquisition, your net equity is your total cash injection plus any seller note on full standby. It's crucial because the SBA requires a minimum equity injection, typically 10-15% of total project costs, which must be from seasoned funds.
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 Net equity
- What is the specific personal net worth threshold that triggers a personal guaranty requirement for an owner?
- Can I use an SBA 7(a) loan to purchase a business with a negative net worth?
- Can an SBA 7(a) loan be used to purchase a business with a negative net worth?
- Can an SBA 7(a) loan be used to purchase a business with a negative tangible net worth?
- What if my business has a negative net worth? Can I still get an SBA 7(a) loan?
- What is the maximum net worth requirement for a business to qualify as "small" for a 7(a) loan?
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.
Figure out your down payment and equity injection
Tell us your purchase price and how you're funding the down payment — we'll sanity-check the equity injection and show what lenders will actually accept.
Free · No documents · Usually same-day
Backed by data on 1,000+ SBA lenders and 300,000+ funded deals. Your details go only to lending partners you ask to be matched with — never sold to advertisers.