For more than 25 years, BBF has been built by countless members who chose to give their time and effort to the organization. What we have today exists because of that commitment, and I am grateful for it. Thank you, Paul McNally, for your guidance over the past two years.
Chair’s Letter
This year is about continuing forward in a thoughtful way.
Our profession keeps changing. Deals are more complex. Clients expect more from their advisors. They rely on business brokers not just for access, but for experience, judgment, and professionalism. BBF plays an important role in supporting its members as those expectations continue to rise.
There are many positive things happening around our organization. We see it in ongoing BLS improvements, strong attendance at luncheons and networking events, successful cobrokerage transactions, and members who step up in local Districts to help move things forward.
BBF membership reflects professionalism, integrity, and competence built over tens of thousands of completed deals. That reputation matters. It works best when members respect one another, take responsibility for how to cooperate with each other, and support the standards that make cobrokerage work.
Education remains a key part of that. Practical, real-world education helps brokers build confidence, avoid mistakes, talk the same language as other brokers and deliver better results. It also helps protect the reputation of our profession. Thank you to those who are organizing luncheons, giving presentations or sharing your experiences!
I also look forward to connecting with many of you at our August conference in West Palm Beach. It will be a chance to learn, share ideas, and spend time together in an amazing location. Please keep watch for registration information over the next month or so.
Thank you for the professionalism you bring to BBF and for doing right by each other. Only when members stay engaged and support one another does our organization stay strong.
I look forward to the year ahead.
Ryan Cave
Chairman, Business Brokers of Florida®
Contrary to popular belief, Seller Notes within an SBA Financed Business Acquisition Are Not Dead!
Seller financing has long played a crucial role in small business acquisitions, especially when an attribute of the deal is not palatable to the Buyer or Underwriting. With the recent changes to the SBA SOP, seller note requirements and uses have changed… changed… not died. These new regulations create opportunities to creatively mitigate deal specific hurdles in the hands of the well-informed.
In my opinion under the new regulations, there are three strategic uses of Seller Notes: (1) notes on full standby for the life of the SBA loan, (2) forgivable notes used to mitigate risk factors, and (3) seller notes on limited standby for two years that can impact the debt service coverage ratio (DSCR). Each variation has unique implications for borrower equity, underwriting, and deal structure.
1. Seller Notes on Full Standby for the Life of the Loan
One of the most powerful tools available in SBA acquisition financing is the seller note placed on full standby for the life of the loan. Under the new SBA regulations, if the note is on complete standby, meaning no payments of principal or interest are allowed until the SBA loan is fully paid, it can count as up to 5% of the required borrower equity injection.
Why This Matters
When acquiring a business, SBA requires borrowers to inject a minimum equity contribution, often 10% of the total project cost. This can be a significant hurdle for buyers, especially first time entrepreneurs or those with limited liquidity. A seller note structured properly on full standby effectively reduces the buyer’s required cash injection from 10% down to as little as 5%, making the deal far more accessible. This should widen your pool of qualified buyers, so I recommend floating the use of seller financing early, especially if the seller wants to quicken the pace of the sale.
Please note: while reducing the borrower’s equity injection to 5% may help preserve cash, it does not waive or lessen the borrowers obligation to meet the bank’s post-closing liquidity (Murphy’s Law Money) guidelines.
For example:
- Total project cost: $1,000,000
- Required equity (10%): $100,000
- Borrower cash injection: $50,000 (5%)
- Seller Note on full standby for the life of the loan: $50,000 (5%)
In this case, the seller note fulfills half of the borrower’s equity requirement.
Benefits
- For buyers: Lower upfront capital requirement, greater access to ownership opportunities.
- For sellers: Demonstrates confidence in the business, potentially widens the buyer pool.
- For lenders: Satisfies SBA’s minimum equity injection while providing added security through seller participation.
Risks
- The seller must be comfortable waiting many years before receiving payment.
- If the business underperforms, sellers may never fully recover their standby note.
2. Forgivable Seller Notes for Risk Mitigation
In some cases, an acquisition presents specific risks that make lenders uneasy, such as customer concentration, asking prices above appraisal, or declining revenues. Here, a forgivable seller note can help close the gap.
How It Works
A forgivable note is essentially a contingent payment obligation. The note is structured so that repayment depends on future business performance or the satisfaction of certain conditions during a set time frame post-closing (typically 2-3 years). If those conditions are not met, the seller agrees to forgive all or part of the obligation.
Use Cases
- Customer concentration: If one customer makes up a significant percentage of revenues, the note may be forgiven if that customer departs within the time frame.
- Over-appraisal pricing: If the business sells for more than the appraised value, the seller note can absorb the excess. Should the business struggle, the note may be reduced or forgiven to bring the effective purchase price in line with true market value.
- Declining revenues: Granted, no one wants to try and catch a falling knife, but a forgivable seller note may serve as a performance buffer – if revenues continue to decline post-sale or a return to historical revenues, profits, or another metric, repayment may be waived.
Benefits
- For buyers: Could mitigate the risk of overpaying for the business, losing an important customer, or other concern.
- For lenders: Provides additional comfort that borrower cash flow will not be overburdened in adverse scenarios.
- For sellers: Still allows for a higher asking price upfront while offering flexibility to buyers and lenders.
Considerations
Borrower’s attorney and Lender’s attorney must carefully draft the note, the forgiveness conditions, and ensure clarity and compliance. While the SBA program does not allow earn-outs, forgivable notes are permissible when structured as conditional forgiveness rather than contingent payments. At the end of the day, the note must be written to benefit the borrower.
3. Seller Notes on Standby for Two Years
The third common variation involves seller notes placed on standby for two years. In this structure, the borrower does not make payments of principal or interest during the standby period, but payments may resume afterward.
Why This Matters
When calculating DSCR (Debt Service Coverage Ratio), SBA requires lenders to include all repayment obligations in the analysis. However, if the seller note is on at least two years of standby, the payments could be excluded from the DSCR calculation during underwriting (at many banks, including mine).
This is particularly useful when the buyer’s projected cash flow is tight. By pushing seller note payments outside of the SBA’s DSCR model for the first two years, lenders can demonstrate compliance with SBA’s underwriting standards while still allowing for seller participation.
Benefits
- For buyers: Improves the DSCR calculation, increasing chances of loan approval.
- For sellers: Still allows eventual repayment without committing to life-of-loan standby.
- For lenders: Creates flexibility in structuring deals where near-term cash flow is constrained.
Example
- Business acquisition price: $1,200,000
- Business Appraisal: $1,000,000
- SBA loan: $900,000 (90% of appraisal)
- Buyer equity injection: $120,000 (10% of project size)
- Seller note (2-year standby): $180,000
Because the $180,000 note is on standby for two years, it does not affect DSCR at underwriting and potentially bridges the valuation gap. After two years, payments begin, but ideally by then the borrower has stabilized operations and improved cash flow.
Putting It All Together: Strategic Structuring of Seller Notes
Each type of seller note serves a different strategic purpose (more than one seller note may be deployed to solve different hurdles):
- Full standby (life of loan): Helps meet SBA equity injection requirements.
- Forgivable notes: Mitigate valuation and performance risks.
- Two-year standby: Eases DSCR constraints during underwriting.
When combined thoughtfully, these tools allow for more flexible and creative deal structures. For example, a complicated transaction might include (all 3 would be a rarity but possible):
- 5% borrower cash equity,
- 5% seller note on full standby to meet the equity requirement,
- An additional seller note on 2-year standby to cover a financing gap,
- And a forgivable note tied to customer retention, providing lender protection.
Key Takeaways for Borrowers, Sellers, and Lenders
- Seller alignment matters. Notes on standby demonstrate that the seller has confidence in the ongoing viability of the business.
- Documentation is critical. SBA requires clear evidence of standby terms, forgiveness conditions, and repayment schedules.
- Flexibility creates deal flow. Properly structured seller notes expand the pool of qualified buyers and make SBA financing possible for transactions that might otherwise fail.
- Risk and reward must balance. While these notes provide important benefits, they also carry risks for sellers, who may wait years for repayment—or in the case of forgivable notes, never receive full repayment.
Conclusion
Seller notes remain a cornerstone of SBA business acquisition financing. Whether structured as equity injection support, forgivable risk mitigators, or DSCR-friendly instruments, they allow deals to move forward that might otherwise stall. For buyers, they reduce upfront cash needs and risk exposure. For sellers, they enable higher transaction values and a wider buyer pool. For lenders, they provide comfort that SBA requirements are being met without overburdening borrower cash flow.
The key is understanding the nuances of each type of seller note and structuring them in compliance with SBA guidelines. With proper planning, seller notes could transform a deal complication from dying on the vine into one that aligns the interests of buyers, sellers, and lenders alike which makes it to the closing table!
Mark Nichols, VP SBA BDO
Phone: (931) 572-8901
Email: mark@sbabizloan.com
Mark brings over 20 years of experience partnering with business owners to secure financing solutions with flexible terms. With a strong focus on building lasting relationships, he takes the time to fully understand each client’s financial goals, allowing him to deliver SBA loans that support long-term success and growth.
Agent Mode for Business Brokers: Your Digital Junior Associate That Never Sleeps
Morning Mayhem
It’s 8:00 a.m. The coffee isn’t even working yet, and the day is already sprinting ahead of you.
- Five NDA requests in your inbox.
- Two sellers asking their favorite question: “So… any new buyers this week?”
- A buyer who wants a 30-page P&L summarized into “just the highlights” (translation: Can you do my homework?).
- And you still haven’t built that call list of local service business owners you promised yourself you’d tackle yesterday.
Welcome to the glamorous life of a business broker.
But what if, instead of drowning in admin before breakfast, you had a digital junior associate – working overnight, processing NDAs, building prospect lists, drafting seller updates, and even prepping tomorrow’s social media posts?
That’s Agent Mode.
What Is Agent Mode?
If you’ve tried ChatGPT, you already know the basics: it’s great at rewriting emails, polishing BizBuySell listings, or brainstorming LinkedIn posts. That’s a good start.
But here’s the difference: ChatGPT answers questions. Agent Mode executes goals.
- ChatGPT: “Rewrite this outreach email to sound more professional.”
- Agent Mode: “Pull a list of restaurant owners in Broward County under $2M revenue, enrich with contact details, draft outreach messages, and upload them into my CRM.”
Agents aren’t just chatbots—they’re like interns who don’t complain, don’t need lunch breaks, and never forget to update the CRM. They have:
- Memory: They carry context from one task to the next.
- Tool use: They connect with CRMs, spreadsheets, and email.
- Multi-step reasoning: They plan, execute, and deliver.
Think of ChatGPT as your consultant. Agent Mode is your junior associate – minus the Starbucks runs and Friday “emergencies”.
Where Brokers Lose the Most Time
We’re not losing deals – we’re losing hours to admin work.
- Chasing NDAs and sending CIMs.
- Entering notes into CRMs that feel like they were built by someone who hates brokers.
- Building call lists one Sunbiz search at a time.
- Turning one listing into five different marketing formats.
- Typing weekly seller updates at 9 p.m.
Important? Yes. Energizing? Not exactly. This is where Agent Mode shines: repetitive, low-precision tasks that still eat up our days.
A Broker’s Day with Agent Mode
8:30 a.m. — Inbox Freedom
Without Agent Mode: You’re attaching CIMs, typing the same “thank you for your interest” email 12 times, and praying you didn’t miss a hot lead.
With Agent Mode: Every NDA is logged, CIMs sent, CRM updated, and follow-ups scheduled. You just review the ones worth your time.
👉 Takeaway: Agents don’t negotiate—they just clear the runway so you can.
10:00 a.m. — Seller Updates (Without the Headache)
Without Agent Mode: You’re combing through emails, scribbled notes, and half-updated CRM entries to answer, “What’s happening with my business?”
With Agent Mode: By Friday, your agent has drafted a clean weekly report—buyer activity, NDAs signed, hot leads noted. You add a personal comment and send.
👉 Takeaway: Consistency builds seller trust—and now it doesn’t cost your Friday afternoon.
12:30 p.m. — Prospecting Over Lunch
Without Agent Mode: You’re toggling between Sunbiz, LinkedIn, and your CRM to build a list of potential sellers.
With Agent Mode: While you’re enjoying a sandwich, your agent delivers a cleaned CSV of salon and restaurant owners in your area, complete with emails.
👉 Takeaway: Agents are the research assistants you always wanted—minus the HR paperwork.
3:00 p.m. — Marketing Magic
Without Agent Mode: You’ve posted a listing on BizBuySell and now have to reformat it for LinkedIn, Facebook, and your email list.
With Agent Mode: You say, “Repurpose this listing,” and get:
- A LinkedIn draft with a strong hook.
- Three Facebook ad variations.
- A polished Mailchimp email.
- All scheduled while you’re on calls.
- Takeaway: Agents multiply your reach without multiplying your staff.
5:00 p.m. — Prep Like a Pro
Without Agent Mode: You’re staring at a 40-page P&L, hoping to pull three talking points before tomorrow’s buyer meeting.
With Agent Mode: You upload the file, and it spits out a bullet summary: revenue trends, margin shifts, and anomalies.
👉 Takeaway: You walk into meetings ready to persuade, not exhausted from paperwork.
7:00 p.m. — Tomorrow, Already Handled
Without Agent Mode: You end the day with tomorrow’s to-do list weighing on you.
With Agent Mode: Overnight, your digital associate builds a prospect list, drafts outreach emails, and schedules your LinkedIn post.
👉 Takeaway: End the day ahead, not behind.
Pitfalls to Watch Out For
Agents are powerful, but they’re not miracle workers. A few guardrails to keep in mind:
- Don’t Over-Automate: Keep human review on sensitive tasks like financials or contracts.
- Garbage In, Garbage Out: If your CRM is messy, your agent will just replicate the mess faster.
- Manage Expectations: Agents won’t close deals—they set you up to close more.
- Confidentiality Counts: Sensitive data needs guardrails and monitoring.
Agents are like interns: full of potential, but don’t give them the car keys unsupervised.
The Future: A Portfolio of Agents
Picture this: every broker with their own digital “team”:
- Valuation Agent: Pulls comps, builds multiples, and drafts valuation ranges.
- Marketing Agent: Repurposes listings, runs ads, and tracks engagement.
- Buyer Intake Agent: Processes NDAs, sends CIMs, flags high-intent buyers.
- Pipeline Agent: Drafts seller updates and organizes due diligence.
Sellers will start asking:
- “How fast can you get my listing in front of buyers?”
- “How many qualified buyers will see my business this week?”
The brokers with agents working overnight will have better answers than the ones still typing reports at midnight.
Final Thoughts
Agent Mode won’t replace brokers. But brokers who use Agent Mode will replace those who don’t.
It’s about time:
- Time saved from repetitive admin.
- Time reinvested in negotiations, listings, and relationships.
- Time to actually have dinner without your laptop glowing at the table.
So the next time you see five NDA requests in your inbox, imagine smiling instead of sighing. Because somewhere in the background, your agent is already on it.
And Finally… A Little Humor
If you’re still skeptical about Agent Mode, here’s a thought:
An agent will never:
- Forget to log your call notes.
- “Accidentally” delete a lead.
- Ask for a raise.
- Eat the last donut in the office kitchen.
Can it misinterpret a P&L sometimes? Sure. But so can humans (especially after lunch).
Bottom line? Agent Mode may not be perfect – but it’s the only junior associate who actually wants to work nights, weekends, and holidays.
👉Lesson for Business Brokers: Start small. Automate one workflow – NDAs, seller updates, or listing repurposing. Build confidence. Add more. Before long, you’ll wonder how you ever worked without your digital junior associate.
John Bucher
Broker / President
Business Broker
KMF Business Advisors LLC
Chair’s Letter
As we bring this year to a close—and as I conclude my two years as your State Chairman, I want to share a message of gratitude, pride, and optimism with each of our members across the Business Brokers of Florida. It has been an honor to serve in this role, and I look forward to turning over the reins to our incoming Chair, Ryan Cave, as he leads us into an exciting new chapter for the BBF. This has been a year where our collective resilience, dedication, and passion have truly shined. No matter what the market brought our way, BBF brokers continued to rise to the occasion, serving clients with professionalism, guiding owners through life-changing transitions, and upholding the standards that define our association.
I hope 2025 has been a year of growth for you, professionally, personally, and in the relationships that sustain your business. Every listing taken, every deal closed, and every challenge met with creativity and determination has strengthened not just your practice, but the BBF as a whole. Together, we continue to elevate what it means to be a business broker in Florida.
And now, we turn toward 2026 with momentum.
Behind the scenes, your leadership team has been working with renewed purpose as we prepare for the BBF Conference this coming August at the Hilton in West Palm Beach. This gathering will be more than an event, it will be a celebration of who we are as brokers, an opportunity to sharpen our craft, and a chance to inspire one another as we step into a new year of possibility.
We are also preparing our new District and State Officier’s as we move into the next chapter of our leadership. This transition symbolizes progress, growth, and our shared commitment to building an association whose impact will stretch far beyond tomorrow. We truly are laying the foundation for the future of business brokerage in Florida.
Our vision is bold: to position the Business Brokers of Florida as the premier business brokerage association in the nation. And with the drive, integrity, and talent of our members, that vision is well within reach. Every one of you plays a vital role in that journey.
As we look ahead, I’m inspired by what we have already achieved and energized by what lies before us. Thank you for your hard work, your trust, and your commitment to excellence. Let’s carry that spirit forward into 2026 and continue building something extraordinary—together.
Wishing you a strong finish to the year and an even stronger beginning to the next.
Paul McNally
Chairman, Business Brokers of Florida®
Intellectual Property Considerations for Business Brokers: A Comprehensive Guide
In the fast-paced world of buying and selling businesses, intellectual property (IP) is a critical asset that can significantly impact the value and success of a transaction. For business brokers, understanding and addressing IP considerations is essential to ensuring smooth and profitable deals. This article explores the key aspects of IP that brokers must keep in mind during business transactions, providing insights into identification, valuation, legal risks, and more.
What is Intellectual Property?
Intellectual property refers to creations of the mind that hold value for businesses. These intangible assets are often pivotal to a company’s brand, operations, and competitive edge. The main types of IP include:
- Trademarks: Logos, brand names, and slogans that distinguish a business’s products or services.
- Copyrights: Original works such as designs, software, marketing materials, social media posts, presentation, podcasts, etc.
- Patents: Inventions and proprietary technologies that provide a competitive advantage.
- Trade Secrets: Confidential information, like recipes or formulas, that offers unique value.
Understanding these categories and their relevance to a business is crucial for brokers navigating the complexities of business sales.
Identifying Intellectual Property Assets
The first step in addressing IP considerations is identifying all relevant assets. Conducting an IP inventory ensures that nothing is overlooked during the transaction process. Areas to review and consider when identifying IP assets:
- Reviewing contracts, marketing materials, and operational documents to pinpoint IP assets.
- Conducting an IP audit to uncover registered and unregistered IP, and to confirm the legal interests of any unregistered IP.
- Asking the seller to disclose all IP-related information including ownership of all trademarks, copyrights, patents, and trade secrets.
- Identifying any risks/potential liability for Buyers related to ongoing IP infringement (ie, social media posts that could be copyright violations, trademark rights that other parties may have to the business’s name, logo, slogan, etc).
Business brokers must ensure comprehensive disclosure to avoid surprises that could derail the deal later.
Evaluating the Value of Intellectual Property
IP can significantly influence a business’s valuation. As a broker, it’s important to assess the worth of IP assets accurately. Common valuation methods include:
- Revenue Contribution: Assessing the income generated directly by IP, such as trademarked products, any potential licensing opportunities, etc.
- Market Comparables: Comparing similar IP assets in recent transactions.
- Replacement Cost: Estimating the expense of developing or acquiring similar IP.
Collaborating with IP valuation experts can provide a more precise understanding of the value these assets bring to the table.
Legal Considerations and Risks
Ownership verification is a cornerstone of any IP transaction. Brokers, through the legal guidance of an IP attorney, should:
- Confirm that the seller owns the IP outright or has the legal authority to transfer it.
- Identify and calendar all renewal deadlines and pending office actions. Check for any adversary proceedings. Verify that trademarks, patents, and copyrights are registered and up-to-date.
- Check for encumbrances such as licensing agreements or liens that may complicate the transfer.
Additionally, ensuring that trade secrets are adequately documented and protected is essential to preserving their value.
Transferring Intellectual Property Rights
The transfer of IP rights requires meticulous documentation. Essential agreements include:
- Assignment Agreements: Legal documents transferring ownership from seller to buyer.
- Licensing Agreements: For situations where IP rights are shared or retained by the seller.
- Non-Compete and Non-Disclosure Agreements: To protect the buyer’s interests post-sale.
It’s also important to register ownership changes with relevant authorities, such as patent or trademark offices, to ensure legal protection for the buyer.
Conclusion
Intellectual property considerations are vital for business brokers aiming to facilitate successful transactions. By thoroughly identifying, valuing, and addressing IP-related issues, brokers can safeguard their clients’ interests and ensure a smooth transfer of assets. Whether you’re a buyer or seller, consulting with an IP attorney and experienced broker is key to navigating this complex landscape.
SecureMark Legal is a dynamic, women-owned law firm that seeks to take the mystery out of brand protection and really take that aspect of protecting business brands “off your plate” so you can focus on what you do best, running your business. We strive to break everything down for you in easily understandable ways and to really become a partner in your success. We are based out of South Florida, but since trademark and copyright registrations are primarily Federal in nature, we are able to serve clients all across the United States regardless of where your business is based.
Melissa H. Jeda and Holly A. McFall
SecureMark Legal®
5278 Golden Gate Pkwy, Ste. 2
Naples, FL 34116
(239) 323-0702