Podcast: Download (Duration: 6:19 — 8.7MB)
How to Buy Your First Franchise Using SBA Loans: A Step-by-Step Guide to 90% Financing and Smart Franchise Ownership
Buying your first franchise can feel overwhelming—especially when it comes to financing. Between choosing the right brand, understanding territory availability, and navigating SBA loan requirements, many aspiring entrepreneurs get stuck before they even begin.
In a recent interview, franchise and SBA financing expert Beau Eckstein broke down exactly how he helps clients move from “I don’t know where to start” to officially becoming business owners—often with as little as 10% down.
If you’ve ever wondered how to buy a franchise using an SBA loan, this guide walks you through the entire process step by step.
Step 1: Start With a Personal & Financial Discovery Conversation
The journey doesn’t begin with picking a brand—it begins with you.
According to Beau, the first step is a general conversation about:
- Your professional background
- Your lifestyle goals
- Whether you plan to keep your W-2 job
- Your available capital
- Your risk tolerance
Some aspiring franchisees want to keep their corporate job for 12–36 months. Others are ready to transition immediately. Understanding this upfront helps shape everything that follows.
After the initial conversation, clients complete a business assessment. This evaluation helps match personality, skills, and financial capacity with appropriate franchise models.
The goal? Alignment between your interests, values, and lifestyle.
Step 2: Create a Custom Franchise Search Strategy
Instead of randomly browsing franchise directories, Beau creates a custom search based on:
- Budget
- Territory availability
- Investment size
- Owner-operator vs semi-absentee models
- SBA eligibility
The process starts wide and narrows quickly. Within days to a week, clients are presented with curated franchise models that fit their profile.
This approach eliminates guesswork and analysis paralysis.
Step 3: Build a “Financing Thesis” for SBA Loans
Here’s where things get powerful.
Many buyers say something like:
“I have $200,000 available, but I only want to put $25,000 down.”
That’s where a financing thesis comes in.
For smaller-ticket franchises (around $150,000 total investment including working capital), Beau often structures deals with 90% SBA financing. That means only 10% equity injection is required.
For larger franchise investments—say $500,000 or more—the capital structure is carefully mapped out based on:
- Borrower strength
- Liquidity
- Credit profile
- Franchise brand performance
One critical factor: the franchise must be listed on the SBA directory to qualify for SBA financing.
Once eligibility is confirmed, Beau connects clients with the bank partner best suited for that particular franchise and borrower profile.
Real Client Success Stories Using SBA Loans
The proof is in the results. Here are just a few examples:
🎨 Painting Franchise
One client entered the painting business with only about $12,000 in equity injection. The total project cost was financed at 90%.
🥤 Vending Businesses
In recent months, multiple vending franchise deals were structured with 90% financing—including working capital.
🏢 Floor Coverings International
A client previously declined by a bank successfully closed after restructuring the SBA loan with a better lending partner.
🏊 Swim Franchise
Another client launched a swim school franchise using SBA-backed funding.
🥗 Toastique
A quick-serve restaurant concept with a total project cost of around $500,000 was successfully financed.
🏀 Pickup USA
A basketball training franchise model involving leased facilities was structured and funded.
💪 Planet Fitness
Even large fitness franchises—including real estate components—have been financed using SBA structures.
The industries vary widely: HVAC, commercial services, fitness, food, youth sports, and more. The key is aligning financing strategy with the right franchise model.
What Makes SBA Loans Ideal for First-Time Franchise Buyers?
SBA loans are powerful because they offer:
- Lower down payments (often 10%)
- Longer repayment terms
- Competitive interest rates
- Working capital inclusion
- Flexible use for equipment, build-out, and real estate
For many first-time buyers, SBA loans make ownership possible without draining savings.
Not Everyone Should Own a Franchise (And That’s Okay)
One refreshing insight Beau shares: not everyone should own a franchise—or even a business.
There are two possible outcomes when someone explores this path:
- They learn a lot and decide business ownership isn’t for them.
- They find a franchise model that aligns with their goals and move forward successfully.
However, Beau strongly believes everyone should consider having some form of side business or additional income stream.
The key is choosing wisely.
How to Get Started Buying a Franchise With SBA Financing
If you’re serious about becoming a franchise owner, the first step is simple: schedule a discovery call and explore your options.
The right guidance can mean the difference between:
- Getting declined by a bank
- Or securing 90% financing and launching your business
Franchise ownership doesn’t have to be confusing or intimidating. With the right strategy, proper SBA structuring, and a lender who understands franchise funding, you can confidently take the leap.
Final Thoughts: Your First Franchise Is Closer Than You Think
Buying your first franchise using an SBA loan is not just possible—it’s happening every day.
With the right assessment, financing plan, and franchise match, you can:
- Replace your income
- Build long-term equity
- Create scalable cash flow
- Own an asset instead of just earning a paycheck
If you’ve been waiting for the “right time,” this might be your sign.
Your first franchise could be one well-structured SBA loan away.