When others are fearful, you should be __________.

If the SBA disappears tomorrow and SBA 7(a) loans go away, here’s what will happen. The exit value of most American small businesses under $2 million in EBITDA will take a massive hit overnight. The majority of buyers will vanish. Nearly 90% of small business owners will lose access to financing that allows them to sell, and liquidity for crucial working capital loans will tighten fast. But this won’t change the supply of businesses that need to sell. The aging Baby Boomer population and what many call the “Great Wealth Transfer” isn’t a theory, it’s happening. Whether you believe it or not, $7-10 trillion worth of small businesses with no heir-apparent need to be sold or shut down in the coming years. These owners aren’t greedy, rich fat cats. They’re 60- and 70-year-olds who have spent decades running HVAC companies, roofing businesses, tree services, and other essential Main Street operations. With fewer buyers and no easy access to financing, many of these businesses will shut down, leaving a gaping hole in the supply of Main Street services. For many owners, retirement nest eggs will shrink or disappear altogether. But well-connected and well-capitalized buyers (like many of our clients) who don’t rely on SBA loans will see an opportunity. They’ll start buying these businesses at massive discounts. This will be devastating for Main Street and the American entrepreneurial class, the real engine of wealth and job creation for the Average American Joe. But it will be a once-in-a-lifetime buying opportunity for private equity, family offices, and anyone with cash who doesn’t need the SBA. The system would shift overnight. The little guy (the first-time business buyer, the local entrepreneur) would get squeezed out, while deep-pocketed investors scoop up businesses for pennies on the dollar. This isn’t some far-fetched scenario. The SBA disappearing would reshape small business ownership in America as we know it. Who wins? The people with capital. Who loses? Main Street.

🚨 Potential SBA Loan Impacts: Federal Funding Pause Announced The OMB has issued a temporary halt on federal financial assistance programs, effective Jan. 28, 2025, to review funding alignment with new priorities. Notably, this may impact SBA lending and related programs. We at @smblawgroup are monitoring developments closely and will provide updates as they emerge.