SBA solved liquidity, not the lemons problem.

SBA 7(a) solved one problem in small business acquisitions and left another one alone. Without SBA, this market would barely move. Banks don't like lending against small businesses with limited collateral. The risk on paper looks terrible. Information asymmetry is real. Many good deals would never get financed. The government guarantee changed that. When 75% of the loan is backed, banks are willing to lend. Both good and bad businesses can now be sold. First-time buyers can get into deals that would have been impossible before. But guarantees don't create better information. Lenders still have to be right about the business. Buyers still have to be right about the business and about their advisors. Rising default rates in SBA acquisition loans are a sign that this is getting harder, not easier. SBA provides capital. It doesn't tell you which deals are sound. Information asymmetry is a massive problem. VerSquare can't solve the asymmetry about your specific acquisition, but we can cut out the information asymmetry when building your deal team and understanding the current market, which means the best possible outcome on any deal. If you've closed an acquisition and had a strong deal team, a five-minute review is exactly the signal this market is missing. Pass it on at www.versquare.com