To the best of my understanding the SBA 7(a) loan demands anyone that has at, or more than, 20% equity in the company have signed a personal guarantee. This would potentially include any preferred equity sponsors as well if they desire more of an equity stake. I know this isn't the answer you wanted, but I'm pretty sure this comes with any meaningful SBA loan. If you want to avoid this I think traditional lending may be your best bet. That said, CIBC and Liveoak not requiring personal guarantees for preferred equity sponsors having less than 20% equity in the business is pretty great IMO.

All SBA loans will require a guarantee if you own 20% or more of the business. The equity in isn't as relevant as the ownership percentage. If you want to avoid a PG you will need to avoid the SBA.

Try to avoid SBA loans if PG is an issue. You can likely get a non-recourse bank loan if the company has $2M+ in EBITDA and a long history of consistent cash flows or significant assets. Otherwise, you may be able to get a non-recourse loan from an SBIC lender[redacted]% interest) assuming there is $1M+ in EBITDA with not a lot of variance over the years. I'm not aware of lenders who will do non-recourse loans below $1M EBITDA.

yep agree with the above comments