Seller finance or escrow in SBA funded deals

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by a searcher
in Illinois, USA

3yrs ago

Seller finance or escrow in SBA funded deals

I am looking for some stats on how many of SBA funded deals does have seller finance or escrow component in the deal structure ?

Trying to make a case with broker for 10% escrow for 12 months due to customer concentration, key employee retention and some reps and warranties. Broker says the 10% is not common.
I thought seller/;broker would be more receptive to escrow than financing.

Thanks in advance.
Amby

1 Like

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reply by a searcher 3yrs ago
from Carnegie Mellon University in San Jose, CA, USA

Seller Note is the most common way to mitigate the Customer Concentration risk. It's not uncommon to have 50%+ SN when the concentration is very high. I know of a specific deal in Bay Area that was closed recently, had almost 50% customer concentration and the seller carried 40% SN.

reply by a searcher 3yrs ago
in Illinois, USA

@Manish - Sorry for the delay, here is what I found : redacted ( Report The 2022 Q3 Market Pulse Executive Summary)