How To Now Get Nearly Unlimited Funding To Build Your Small Business Empire

Forbes Daily Briefing

Forbes

Careers, Business, News, Entrepreneurship

4.6 • 12 Ratings

🗓️ 22 October 2024

⏱️ 4 minutes

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Summary

The Small Business Administration has removed the $5 million per borrower cap on its popular 7(a) loan guarantee program. But to take advantage of the change, you’ll need to diversify.

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0:00.0	Here is your Forbes Daily Briefing for Tuesday, October 22nd.
0:05.0	Today on Forbes, How to Now Get Nearly Unlimited Funding
0:09.5	to Build Your Small Business Empire.
0:12.3	The Golden Ticket to Buy a Small Business Empire.
0:13.3	The Golden Ticket to buy a Small Business has always been a Small Business Administration
0:17.5	loan, especially the 7A loan.
0:20.6	But thanks to a recent and overlooked rule change, it just got even better,
0:24.4	giving ambitious entrepreneurs a chance to build a diversified collection of small businesses,
0:29.2	their own baby Berkshire Hathways.
0:31.4	The 7A program was established in the same law baby Berkshire Hathways.
0:32.5	The 7A program was established in the same law that created the Small Business Administration,
0:37.4	also known as the SBA, in 1953.
0:41.1	The SBA provides a 75% guarantee on these loans, reducing the risk for lenders and thereby
0:46.6	encouraging them to fund small businesses.
0:49.9	The money can be used for working capital, equipment, real estate, or even to buy a business.
0:56.2	Business buyers love the SBA 7A program, not only because it makes more loans available,
1:01.5	but also because of its forgiving collateral requirements.
1:05.0	Most of the time, a personal guarantee from the buyer is enough.
1:08.8	Even better, borrowers often don't need to put much, if any, money down.
1:14.0	Repayment terms can stretch up to 25 years,
1:17.0	making it a more affordable option than a standard bank loan
1:20.0	that typically maxes out at just 10 years.
	...

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