Glossary · Your money in the deal
Startup costs
In short
These are the initial expenses required to get a new business, or a newly acquired one, operational. For an acquisition, they often include working capital, initial inventory, and build-out expenses.
What it means in a deal
While the 7(a) loan covers most acquisition costs, you'll still need funds for immediate post-closing expenses. This can include initial inventory restocking, leasehold improvements (build-out), or new equipment. Ensure your total project costs accurately account for these, as they impact your required equity injection.
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 Startup costs
- Does an SBA 7(a) loan cover the initial franchise fee and associated startup costs?
- Are closing costs, like attorney fees, eligible to be part of the project costs for an SBA loan?
- Are SBA 7(a) loans only for very small, startup businesses?
- What if the business I'm acquiring is a startup with limited operating history?
- Are SBA 7(a) loans mainly for startup businesses, or also for existing ones?
- Can an SBA 7(a) loan be used to buy equipment for a new startup?
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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