Underwrite a Deal
The Target
Verdict
- WatchAsking 3.0x against a 1.72x to 2.87x band
Above the cited range for this industry. Either the business is genuinely better than its peers and you can show why, or the ask is soft.
- GoodDSCR after your salary is 2.29
Above the 1.25 rule of thumb.
The Number That Should Set Your Offer
At $500,000 of SDE, a $100,000 owner salary, $200,000 of cash, and a 10% seller note, the most this business can carry at a 1.25 DSCR is $2,561,235. The ask sits $1,061,235 under it.
Structure
- Equity (your cash)
- $200,000
- Seller note
- $150,000
- 7(a) loan
- $1,150,000
- Annual debt service
- $174,813
- DSCR
- 2.29
- Implied multiple
- 3.00x
- Cited band
- 1.72x–2.87x SDE
Context
- Industry charge-off
- not measurable
- State median loan
- –
- State FY2025 loans
- –
More in Diligence & Close the Deal
Deal Tools
The checklist, the math, and the terms.
LOI Terms Worksheet
Decide the terms before the template.
Diligence Checklist
Every diligence workstream, through to close.
Document Requests
Ask for it once, then track what arrives.
Scope the QoE
Price the earnings work, then the deal.
Reading the FDD
The layer a franchise resale adds.
Deal Resources
The advisors your closing actually hires.
What the Loan File Contains
What a lender asks for and what a no means.
Lenders
Filter the verified lenders by your deal.
SBA Acquisition Calculator
Which limits the deal: your cash or the earnings.
Deal Outreach Templates
Engaging advisors and running the workstreams.