Glossary · Your money in the deal
Tangible capital contribution
In short
This refers to your equity injection that consists of actual cash or hard assets with verifiable value, not goodwill or intangible assets. It's the most straightforward form of equity.
What it means in a deal
The SBA prefers tangible capital contributions as they represent real value. While goodwill can be part of the purchase price, your equity injection primarily needs to be cash or assets like real estate or equipment. Lenders will assess the fair market value of any non-cash contributions.
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 Tangible 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 if the business I'm buying has limited tangible assets for collateral?
- What is the typical down payment or equity contribution required for an SBA 7(a) loan?
- What are the typical collateral requirements if the business has very few tangible assets?
- Can a seller note be used to finance the entire seller's equity contribution to the buyer's business?
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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