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For the employee-buyer: what you'd need to put in, and what you'd take home each month. For the owner: what the deal structure looks like and what your note would pay you. Enter the business's numbers below; the estimate updates as you go.
The owner's total benefit from the business: net profit plus their salary, benefits, and personal expenses run through it. If unsure, use annual revenue × 15–20% as a rough stand-in.
Most sub-$1.5M service businesses sell in the 2–2.5× SDE range.
A note the retiring owner carries, on full standby (no principal or interest payments) for the entire SBA loan term, typically 10 years, to count toward the equity injection. Confirm current treatment with your SBA lender before relying on it.
Extra cash financed alongside the purchase. This raises total project cost, and with it, the dollar size of the required equity injection.
New Wave invests 5–10% of the purchase price directly, and that percentage is the ownership stake. This is a target range set by negotiation, not a formula, but the dollar check and the ownership percentage always move together.
Skin in the game: the employee must put in at least half of New Wave's check, or match it dollar-for-dollar. Any equity beyond what the SBA minimum requires becomes working capital, not a smaller loan.
Compared against their required contribution below to check feasibility.
A market wage for running the business, set in the operating agreement at closing so it can't be unilaterally raised later at New Wave's expense. This is a label for part of the owner's own share below, not a separate expense that reduces New Wave's dividend.
A real operating cost to the business, reduces the shared pool before the equity split, same as debt service. Separate from New Wave's dividend — this is service income on top of it.
This is a New Wave policy shortfall, not an SBA problem. New Wave's check alone may already satisfy the SBA's minimum requirement, so the loan estimate above is still valid. But the employee's available cash doesn't yet cover New Wave's own skin-in-the-game requirement (— short). Either lower New Wave's stake, lower the required ratio, or the employee needs more cash before New Wave would actually agree to this structure.
This one is an actual SBA eligibility problem. Even combined, New Wave's check and the employee's required contribution fall short of the SBA's minimum equity injection, so the loan estimate above wouldn't actually be approvable as structured. Raise New Wave's stake, the required ratio, add more seller financing, or lower the working capital add-on.
This salary is higher than the owner's share of distributable cash can currently support alongside New Wave's dividend and the debt payments. Either lower the salary, or this deal needs a different structure.
Illustrative only. Actual equity injection rules, seller-note treatment, loan rates, and ownership percentage are set by the lender and by negotiation, not by this calculator. Not a loan pre-qualification or an offer of financing.
Send us your numbers and we'll follow up with a real read on financeability, not just a formula.