A couple of weeks ago I shared a list of 19 ways we've seen small business acquisitions fail - everything from deferred capex and inflated add-backs to change-of-control clauses buried in supplier contracts and environmental liability at auto shops. The response was strong, and the comments made the list better. To borrow from Charlie Munger: “All I want to know is where I'm going to die so I never go there.” The original 19 can be read in full here. But based on what people shared in the comments, I'm adding a few more to the list. 20. ERTC tax credits recorded as income on the P&L - a one-time government benefit that inflates EBITDA and will never repeat. 21. The SaaS product runs on outdated software built by contractors who are long gone, and the underlying technology is approaching end of life. 22. New ownership resets credit terms and financing relationships with key suppliers - rates grandfathered in for the previous owner don't automatically transfer. 23. The tribal knowledge problem: SOPs that should exist but don't, with critical processes, formulas, and customer knowledge living exclusively in the owner's head or a veteran employee who refuses to document anything. The business looks transferable on paper. It isn't. 24. Off-balance-sheet credit card balances understating expenses, severance liability for longtime employees who can't adjust to new management, and owners who conveniently go on vacation during diligence to project a "hands-off" business while actually just slowing down the process. 25. Culture - a toxic or dysfunctional culture that the previous owner held together through sheer personality can bleed through fast once they're gone, and it's one of the hardest things for a first-time CEO to manage. This is quite a list. Let me know if you have more to add. Partner Perspective: Matthias Smith, Pioneer Capital Advisory: Not All SBA Lenders Underwrite the Same Deal the Same Way Before I dig in, a quick scoreboard. So far in 2026, our team has helped buyers close 27 acquisitions representing just over $62 million in SBA loan volume. I don't share that to brag. I share it because those 27 deals are exactly where this month's lesson comes from. When you take that many files to market, you watch the same deal go to multiple banks and come back looking like three different transactions. That's the misconception I run into most: the idea that "SBA is SBA." Because the 7(a) program runs on one rulebook, the SOP, buyers assume every lender will read their deal the same way and land in roughly the same place. It doesn't work like that. The SBA sets the outer guardrails. Inside those guardrails, every bank builds its own credit box, and those boxes vary far more than most buyers expect. Here's where I routinely see two lenders diverge on the identical file: • Add-backs and how they normalize cash flow. This is the big one. The same business can pencil as a roughly $4 million EBITDA deal to one lender and a $3 million deal to the next, purely based on which owner add-backs survive their scrub and how they treat the quality-of-earnings findings. One bank accepts the add-backs and the deal sails through at full leverage. The next strips half of them out, the cash flow shrinks, and suddenly the loan gets sized down or the debt service coverage no longer works. Same financials, different lens. • Industry appetite. A NAICS code that one lender loves is one another simply won't touch this quarter. Appetite shifts with a bank's existing concentration and recent loss experience, and it's rarely posted anywhere you can see it. • Customer concentration. One lender flatly declines anything over a certain single-customer threshold. Another will underwrite around it if the relationship is sticky and contracted. I've seen the exact same concentration draw a hard "no" at one bank and a clean term sheet at the next. • Equity injection and seller notes. The SBA floor is 10% for a change of ownership, but how you get there is lender-specific. Some will let a seller note count toward the buyer's injection if it's on full standby for the life of the loan (up to half the required injection). Others won't give you that credit at all and want more cash in. • Historical vs. projections, post-close liquidity, and speed. Some lenders will lend on a business plan and projections. Others live strictly on trailing performance. Some want to see meaningful post-close liquidity; others are more flexible. And timelines, including when a bank actually funds on deals with construction or leasehold improvements, can differ by weeks. None of this means one bank is "right" and another is "wrong." It means a decline is often a statement about that lender's credit box, not about your deal. I've had files come back with a fast "no" from a bank that was full up in the industry, then move straight into underwriting somewhere else without changing a single number. That's the whole reason our model works the way it does. We're not tied to one balance sheet. We maintain relationships across a wide network of SBA lenders, so the goal is to get your deal in front of the banks whose credit box actually fits it, the first time, instead of you burning weeks (and earnest money) learning one lender's appetite the hard way. If you're evaluating a target, or you've already gotten a "no" you're not sure you deserved, please reach out to us through our website. Getting your deal to the right lender on the first pass is most of the battle. Plus: • EBITDA is only one chapter of the story. Customer concentration, purchase multiple, cyclicality, and earnings history matter just as much to most investors - and this post is a good reminder of the many attributes that drive investment decisions. • Chicago: We’re hosting a happy hour next Thursday, July 16, at Randolph Tavern alongside Pioneer Capital Advisory, Rejigg, Northwest Bank, and Search Fund Coalition. It’s going to be a great time - register here if you can join us!redacted