Experience with SBIC loans?

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June 17, 2025

by a searcher from University of Pennsylvania - The Wharton School in Philadelphia, PA, USA

I'm considering expanding my search north of the typical SBA 7a size territory and wanted to connect with some searchers with experience doing larger deals and leveraging either SBIC or commercial lending. Specifically, I'm looking for typical terms, deal size and structure and any learnings/guidance from those who have navigated the process before.
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commentor profile
Reply by a searcher
in New York, NY, USA
It is hard to get the attention of an SBIC fund for a deal lower than $4m of EBITDA. Many firms will say on their two-pager that their minimum is $2m. In reality, it is $3m or higher. (Those that say $3m, it is $4m.) If you fit that size, you will likely see debt offered at 3.0x EBITDA at about 12% cash interest, and there will be another element that is either PIK interest or warrants for them to generate further return. If you have an equity gap where the 3.0x EBITDA loan is not enough, some firms will offer you preferred equity as well. This will be at a more expensive rate than the debt, but it is usually completely PIK.
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Reply by an member
from Brown University in United States
Hi Jamie, just sent you a message. We have a solid relationship with an SBIC that could be helpful.
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