Lendway Capital Advisors

Giving away equity can solve a funding problem.

But it can also create a control problem.

When investors come into the deal, ownership gets diluted. Profits may get shared. Decision-making can get more complicated. And the original buyer may lose some of the freedom that made them want to own the business in the first place.

That is why Pari Passu financing can be useful for the right lower middle market acquisition.

Instead of giving up a percentage of the company, a buyer may be able to use a combination of:

• SBA 7(a) financing up to the exposure limit
• A conventional note in Pari Passu position
• Seller financing
• Buyer equity injection

This can help create a larger capital stack without immediately turning to outside equity.

It is not for every deal.

The business still has to make sense. The cash flow has to support the structure. The buyer has to be qualified. The numbers have to work.

But when they do, Pari Passu can give acquisition buyers another option before they start giving away ownership.

For business owners, buyers, and brokers working on larger acquisition deals, this is a structure worth understanding before assuming equity is the only path forward.

Learn more: https://ow.ly/GKub50Z4K4Q

A lot of lower middle market acquisitions run into the same wall:

The deal is bigger than the SBA 7(a) exposure limit.

That does not always mean the buyer has to give up equity.

With a Pari Passu structure, the first note can max out the SBA 7(a) exposure limit, and an additional conventional note can be added in a Pari Passu position.

Pari Passu means “on equal footing” or “side by side.”

In plain English:

The structure can help support larger business acquisition financing when the deal has strong cash flow, even if there is limited real estate or hard collateral.

That matters for businesses like:

• Trucking
• Janitorial
• Construction
• IT
• Business services
• Retail
• Other cash-flowing acquisition targets

For buyers trying to close a larger acquisition, the question is not always, “Is there enough collateral?”

Sometimes the better question is:

Does the business cash flow well enough to support the debt?

That is where Pari Passu financing may be worth looking at.

Learn more: https://ow.ly/mZQC50Z4JRx

Most SBA loans are variable rate loans.

A lot of buyers don’t fully understand what that means until after they close.

Most structures are based on:
Prime Rate + a spread of roughly 2.00%–2.75%.

So when the Federal Reserve raises rates…
your interest rate can increase.

When rates come down…
your payment can improve too.

That’s why understanding debt service and cash flow upfront matters so much in business acquisitions.

A deal should not just work today.

It should still make sense if rates move tomorrow.

That’s where proper structuring matters.

👉 Learn more about SBA acquisition financing:
https://ow.ly/FFCt50Z1irO

Most SBA loan problems start before the application is even submitted.

Missing documents.
Incomplete financials.
Bad deal structure.
Wrong expectations.

Then people wonder why the process drags on for months.

Before you apply for an SBA loan, get your documentation organized FIRST.

That means:
• 3 years of business & personal tax returns
• Current P&L and balance sheet
• Debt schedule
• Personal financial statement
• Resume/industry experience
• Credit report

Especially for business acquisitions.

Because lenders are not just evaluating the business.

They are evaluating YOU as the operator.

The smoother your documentation is upfront, the faster underwriting moves later.

That’s one reason why experienced SBA advisors matter.

A good team can identify issues early, structure the deal correctly, and help avoid unnecessary delays before they become major problems.

Time kills deals.

👉 Learn more about SBA acquisition financing:
https://ow.ly/ULjO50Z1iae

Most people don’t hate SBA loans.

They hate what they went through trying to get one.

❌ Endless back-and-forth
❌ Banks that didn’t understand the deal
❌ Brokers who overpromised
❌ Weeks wasted with no real answers

That’s exactly why Lendway Capital Advisors is on a mission to change the perception of SBA financing.

We help structure business acquisition loans to actually close.

Because SBA loans are not “bad” when they’re handled correctly.

The reality is:
• SBA lending is highly specialized
• SOP guidelines constantly change
• Deal structure matters
• Experience matters even more

Our team has spent 13+ years helping business owners and brokers navigate SBA acquisitions, Pari Passu structures, USDA loans, and asset-based lending.

We work with urgency because time kills deals.

And if something won’t work?
We tell you right away and explain why.

No guessing.
No dragging things out for 90+ days.
No wasting your time.

Just experienced deal structuring designed to move transactions forward.

👉 Explore our SBA acquisition financing solutions:
https://ow.ly/n9Ea50Z1hOs

Most entrepreneurs spend years building a company…

Then give part of it away the second growth gets expensive.

That might work for some people.

But if the business cash flows properly, there may be another path.

A lot of buyers and operators don’t realize what can happen after the SBA 7A exposure limit is reached.

That’s where Pari Passu structures come into play.

• First note structured through SBA 7A
• Additional conventional note added alongside it
• Up to $10M total funding potential
• No equity dilution

And that changes the conversation completely.

Because bringing in investors can also mean:
• More opinions
• More approvals
• More pressure for short-term returns
• Less control over long-term direction

Sometimes the business you built slowly stops feeling like yours.

Pari Passu financing was designed for lower middle market acquisitions that still have strong cash flow, even without massive hard assets or real estate.

Truck routes.
Construction companies.
IT firms.
Business services.
Blue-sky acquisitions.

If the numbers work, the structure may work too.

Learn more:
https://ow.ly/LOHv50YZwTJ

Most business owners never stop to ask this question before bringing in investors:

“Do I actually need to give away equity?”

Because once you do, everything changes.

You now have:
• More opinions involved
• Less ownership
• Shared profits
• Shared control
• Shared decision-making

And eventually, selling the company can become far more complicated.

Pari Passu financing was designed for situations where a borrower’s SBA 7A exposure limit is maxed out at $5 million.

An additional conventional note can then be added in Pari Passu position for up to another $5 million.

That creates:
✔ Up to $10M in non-equity funding
✔ Equal protection between both loans
✔ A structure based on business cash flow
✔ No requirement to give away ownership

This structure has been used for trucking, janitorial, construction, IT, retail, and business service companies.

The reality is simple:

If the debt can be serviced properly, you may not need investors at all.

And keeping ownership matters more than most people realize.

Learn more:
https://ow.ly/hZLG50YZwPZ

Giving away equity might be the most expensive decision you ever make.

Not because of the money you raise…

Because of what you lose afterward.

A lot of entrepreneurs don’t realize there may be another option once their SBA 7A exposure limit hits $5 million.

With a Pari Passu structure:
• The first $5M can be structured through SBA 7A
• Then an additional conventional note can be added
• Up to another $5M in funding
• Without giving up equity

That means up to $10M in non-equity debt funding.

And that matters.

Because once investors enter the picture:
→ You answer to someone else
→ Your ownership gets diluted
→ Future fundraising can get messy
→ Selling the company becomes harder
→ Profits get shared
→ Stress levels go up if visions don’t align

Sometimes investors only care about rate of return.

Sometimes they only care about the short term.

Sometimes they want control.

And sometimes entrepreneurs lose the company they built.

Debt is not always a bad thing if the business can properly service it.

If the cash flow is there, why give away a percentage of your company if you don’t have to?

Pari Passu loans were created for situations exactly like this.

👉 https://ow.ly/zMBj50YZwza

Most people in the business acquisition world have never even heard of Pari Passu financing.

But for the lower middle market…
it can completely change what’s possible.

Here’s the simple version:

Once a borrower reaches the SBA 7(a) exposure limit of $5 million, an additional conventional note can sometimes be added alongside it in what’s called a Pari Passu structure.

“Pari Passu” means “on equal footing.”

This structure can allow deals to go beyond traditional SBA limits without giving up equity.

And contrary to what many people think…
these deals do NOT always require massive real estate holdings or hard assets.

The real focus is often:

➡️ Enterprise value
➡️ Business cash flow
➡️ Debt service ability

We’ve helped structure Pari Passu transactions across industries like:

• Trucking
• Construction
• IT Services
• Janitorial
• Retail
• Business Services
• And more

A lot of acquisitions never close because buyers are talking to lenders that only understand collateral.

Cash flow matters.
Structure matters.
Experience matters.

Learn more:
https://ow.ly/EtiK50YW96n

This Deal Was Stuck Because the Buyer Didn’t Have the Required License to Run the Company…

More and more lenders are getting stricter about licensing requirements when it comes to trade-related business acquisitions.

Especially on SBA-backed deals.

This electrical company had operated successfully for decades under the seller’s personal license. Fortunately, the seller planned ahead and hired a licensed manager years earlier with the same designation.

That decision ended up saving the deal.

The buyer had extensive experience in the trades, but did not yet hold the required state license himself. Most lenders today are no longer comfortable relying on the seller’s license after closing because they view it as a temporary solution.

Now here’s where experience and structuring matter.

The buyer wasn’t an outsider trying to jump industries. He had a legitimate background in the trades and a realistic plan to secure the license himself within about a year.

So we advised him to secure a 2-year employment agreement with the existing licensed manager.

That gave the lender comfort.
That gave the buyer time.
And that got the deal to the finish line.

Sometimes acquisitions don’t fall apart because of cash flow.
They fall apart because nobody structures around the actual problem.

Time is the most valuable commodity we have…Let’s not waste it.

📞 847-644-8085
🌐 https://ow.ly/ZAXo50YW8Zk