Glossary · Reading the business
Working Capital Projections
In short
These are forecasts of the cash a business needs to cover its day-to-day operations after an acquisition, beyond the purchase price. Accurate projections ensure the business has enough liquidity to operate smoothly post-closing.
What it means in a deal
SBA lenders require detailed working capital projections to ensure the acquired business can sustain itself without immediate cash shortfalls. You'll need to show how much cash is required for inventory, payroll, and other operating expenses, and how that will be funded. Underestimate at your peril; the lender will scrutinize this.
Related terms
Common questions about Working Capital Projections
- How does the SBA's 'prudent lending standards' apply to the evaluation of working capital projections for a new business acquisition?
- 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?
- Can an SBA 7(a) loan finance working capital?
- What is the typical repayment term for working capital only?
- Can working capital be used for unexpected business expenses after closing?
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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