Individual-tied licenses with new SBA rules

September 24, 2025

by a searcher from University of Maryland at College Park in Austin, TX, USA

I know there are quite a lot of posts about this, but they all seem to be over a year old, so I wanted to see if there are fresh thoughts, considering the new SBA SOPs from the summer. Also considering that HVAC seems to be having a particular heyday in ETA*. How does everyone think about businesses that have licenses tied to the seller and their specific trade experience? Easy solutions are to give a qualifying employee % to stay on and be the qualifier... but that trips some wires with the new SBA rules, no? Another path is to provide enough incentive to an employee (without equity) to stay on as qualifier long enough for the buyer to become licensed. But depending on the specific industry, is that really reasonable? My understanding is that typically, if someone is a qualifying individual for a license they typically are in business for themselves (or will very soon want to be). I've had individual-tied licenses as a deal breaker, but I'm thinking there has got to be a way that people make it work. Otherwise, they wouldn't be so incredibly popular. *I know HVAC has ALWAYS been the poster child for ETA. But it's hitting different right now. Or maybe that's just me.

Reply by a searcher
in San Antonio, TX, USA

We have a master electrician and HVACR license and have not found a solid business. I can't imagine how difficult it is to close on a deal for those buyers without those licenses or experience. Also earning an electrical or HVAC license is not a quick process. I can attest, my husband earned his masters recently and it takes many many years to secure that. You must first be an apprentice, then journeyman, then you can test to be a master. In Texas at least, you must have a Master electrician license to operate a business. PE has made this market over priced. We are unfortunately starting to search in different industries.

Reply by a searcher
from The University of Michigan in Ann Arbor, MI, USA

I was looking at a small local electrician about six months ago but the licensing was the main obstacle as the owner was retiring and did not want to stay on and none of his other employees had a Master Electrician license. The licensing processing takes about 4 years to obtain from what I was told. I don't know if HVAC licenses are easier to get but the bottom line is you want to have that license under your name and not depend on anyone else if you are looking at acquisitions on the smaller scale.

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