Project Based Businesses

April 06, 2026

by a searcher from Florida State University in St. Petersburg, FL, USA

While I understand recurring revenue models are highly attractive to all of us, at what point does a project based business become attractive to investors and SBA lenders? I am referring to glass fabrication/installation, custom cabinets, etc… I like these types of businesses personally, but I am curious on others thoughts and experience with raising capital for this type of business and the smaller buyer pool for potential exit in the future?

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Reply by a professional-advisory
from St. Joseph's University in Tampa, FL, USA

Hey Parker! Great question...so it's layered for me... As a new Senior Associate at a capital firm focused on home services (largely because of their recession-resistant characteristics) I’ve spent a lot of time thinking about exactly this tradeoff. While recurring revenue is the gold standard, project-based businesses like glass fabrication, custom cabinetry, and similar trades absolutely become attractive once they demonstrate a few key qualities. From an SBA lender’s perspective, consistency of cash flow matters more than strict “recurring” structure. If a project-based business shows strong historical revenue stability, diversified customer sources (not overly reliant on a few contracts), and healthy margins, it can underwrite very similarly to a service business with contracts. Backlog visibility, repeat builder relationships, and referral-driven pipelines all help bridge that gap. On the equity side, working with a mix of LPs and SBA lenders, I’ve seen different appetites. Some LPs are perfectly comfortable funding alongside SBA leverage, while others, especially family offices or operators with domain expertise, may step in to fund the entire deal themselves. That tends to happen in a few scenarios: when the business has a dominant local reputation, when there’s a clear operational value-creation angle (pricing, scheduling, salesforce buildout), or when the LP has a strategic angle (e.g., rolling up adjacent trades or vertically integrating into an existing platform). As for exits, you’re right that the buyer pool can be smaller versus true recurring-revenue models. But quality project-based businesses with scale, strong margins, and institutionalized operations still trade well—especially if you can professionalize them and create some level of revenue predictability. In many cases, the “story” evolves from a project shop to a systems-driven operator, which broadens the exit universe considerably. I hope this helps!

Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA

Parker, great question. Project based businesses can be very sound opportunities. I would focus on project based businesses that have relatively consistent revenues and margins. Most lenders, including many SBA lenders, are open to project based businesses with consistent revenues and profits. Whenever you look at businesses that are project based, you just need to be hyper-focused on what type of economic conditions could impact the business going forward. Project based businesses tend to be more likely to see large swings in revenues due to market conditions, but that is not always the case depending on how solid the specific business is. If you ever need help analyzing a business, we offer a free review from a lender perspective and can help figure out which deals make sense and give you feedback on how lenders may react. You can reach me here or directly at redacted

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