SBA Financing - Unique Deal Structures

November 26, 2022

by a searcher from Carleton College in Burlingame, CA, USA

Hi,

I am looking to acquire a small landscaping maintenance company in California. In order to legally operate as a landscaper in California, you must hold a C-27 Landscaping License. In short, the current owner is the only holder of the C-27 License and it would take me roughly 3.5 Years to acquire the license. The state allows the license to be held by a Responsible Managing Employee (RME), which means the owner could possibly maintain the license until I am able to apply for mine.

Traditionally the SBA does not allow the owner to be involved post transaction. I would really appreciate understanding any creative financing structures that would allow me to still complete the transaction.

Thank you in advance.

Reply by a searcher
from Northwestern University in Los Gatos, CA, USA

I might be able to help - I hold a C27 and recently sold my landscaping co. redacted can also connect you with our CSLB consultant who was fantastically helpful. College degree counts for 2 years of experience, so you'll need to be in operating for 2 years before you can sit for the test and not be dependent on the previous owner.

Reply by a professional
from The University of Alabama in Birmingham, AL, USA

There are agencies in CA that you can use for this. You’re essentially operating under their license while they train you/educate you to get your own. It’s fairly cost effective from what I’ve seen. The specific agreement would need to be reviewed by your lender just like any other management agreement.

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