SBA Lender Reveal the Most Profitable Businesses to Buy

Thinking of buying an HVAC, plumbing, or electrical business? In this episode, we sit down with a top lender from Live Oak Bank, the #1 SBA lender in the U.S., to uncover the insider secrets of business acquisition financing.

We break down how to qualify for an SBA loan, the hidden red flags in seller financials, the biggest mistakes first-time buyers make, and the real reason some deals fall apart at the last minute. Whether you're an investor, operator, or aspiring buyer, this deep dive will help you avoid costly mistakes and close smarter deals.

In This Video:

What banks actually look for when approving SBA loans

The difference between buying residential vs. commercial service businesses

Licensing traps that kill deals (and how to fix them)

Real-world loan structures, seller note strategies & buyout scenarios

How to tell if a business is “bankable” before you waste time

Due diligence tips you won’t hear anywhere else

Key Topics Covered:

SBA loan requirements for HVAC, plumbing & electrical businesses

Common deal killers: licensing, working capital, seller behavior

What makes Live Oak Bank different (and faster)

How to finance acquisitions with little to no collateral

Trends in small business acquisitions for 2024 and beyond

Perfect For:
Entrepreneurs • Acquisition Entrepreneurs • Small Business Buyers • HVAC Operators • Plumbing Business Owners • Anyone looking to get funded via SBA loans

00:00 - Intro
01:03 - Meet the Lender: Background and How He Joined Live Oak Bank
02:46 - From Small Banks to #1 SBA Lender in the U.S.
04:53 - Why Live Oak Focuses on HVAC, Plumbing, and Electrical
06:54 - What Makes a Business "Bankable"
08:48 - Service Businesses vs. New Construction Risks
10:25 - Key Traits of Strong Operators
12:33 - First-Time Buyers vs. Experienced Operators
14:18 - The Licensing Trap That Can Kill Deals
16:40 - What the SBA Requires in Licensing Transitions
18:27 - How to Structure Deals Without Industry Experience
21:05 - Red Flags in Due Diligence (Culture, Misleading Sellers)
23:00 - Customer Concentration, Cash Flow, and Risk
25:32 - Common Cash Flow Mistakes in Small Businesses
28:00 - How Personal Credit & Owner Salary Affects Loan Approval
31:12 - Real SBA Deal Examples: $6.5M, $12M Exit, & More
33:28 - Why Some Businesses Get Rejected (Even If Profitable)
35:47 - Creative Deal Structures That Work
37:52 - When Seller Financing Becomes a Problem
40:01 - SBA Refinance Rules Explained
42:00 - Negotiating Working Capital in Deals
44:03 - Speed & Timing: Why Closing Dates Are a Major Hurdle
46:00 - The Role of Personality & Leadership Post-Acquisition
47:53 - Culture Due Diligence: How to Vet What You Can’t See
50:06 - Key Questions to Ask Before You Buy a Business
51:42 - Pricing Mistakes That Hurt Profit Margins
53:40 - Equipment, Inventory, and Supplier Relationships
55:29 - Why Residential Businesses Usually Cash Flow Better
57:01 - Common Last-Minute Deal Killers
59:15 - What Good Buyers Do That Others Don’t
01:00:48 - Final Advice to Aspiring Buyers

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