7 Proven Ways to Buy a Business with No Money Down

Buying a business with no money down might sound like a fantasy—but it’s absolutely possible, especially in 2025’s deal-friendly environment. Creative financing, willing sellers, and the right knowledge can help you acquire a profitable business without draining your savings.

In this guide, we’ll walk you through 7 proven ways to buy a business with little or no upfront cash, based on real-world strategies used by successful buyers. Whether you’re a first-time acquirer or a strategic investor, these methods are working now—and they can work for you too.

1. Seller Financing

What It Is

Seller financing means the current owner agrees to finance a portion of the sale. Instead of getting paid in full at closing, the seller accepts a promissory note and gets paid over time.

How It Works

You and the seller agree on a purchase price and a down payment (which can sometimes be zero). The remaining balance is paid off monthly with interest, like a loan.

Pros

• Flexible terms
• Builds seller confidence in your commitment
• Often faster and less paperwork than bank loans

Cons

• Not all sellers are open to it
• You need to convince the seller you’re a credible buyer

Example

A laundromat owner agrees to sell their business for $300,000. You negotiate to pay $0 down, with monthly payments of $5,000 over 5 years. The seller is confident because you’re keeping their staff and operations intact.

2. SBA-Backed Loans (Low or No Money Down with Equity Injection Alternatives)

What It Is

The U.S. Small Business Administration (SBA) guarantees loans made by partner banks to business buyers, reducing lender risk. These loans often require only 10% down—but there are ways to reduce or eliminate that.

How It Works

You secure an SBA 7(a) loan for up to 90% of the purchase price. The remaining 10% can sometimes come from seller financing or an investor—eliminating the need for your own cash.

Pros

• Long repayment terms (up to 10 years)
• Low interest rates
• Accessible to first-time buyers with good credit

Cons

• Extensive paperwork and vetting
• You may still need some cash if no secondary funding is lined up

Example

You buy a $500,000 service business. The bank covers 90% via an SBA loan. The seller agrees to finance the remaining 10%. You contribute $0 out of pocket.

3. Earn-Outs

What It Is

An earn-out is when a portion of the purchase price is paid based on the business hitting future performance targets.

How It Works

You pay part of the price now (or nothing), and the rest later—if the business meets certain revenue or profit goals. This aligns incentives and reduces upfront risk.

Pros

• Pay based on performance
• Can reduce upfront purchase price
• Encourages seller cooperation during transition

Cons

• Complex agreements
• Potential for disputes over performance metrics

Example

You buy a marketing agency for $400,000. You pay $100,000 over time via seller financing, and the remaining $300,000 only if the agency hits $1M in revenue over 18 months.

4. Asset-Based Lending

What It Is

A lender provides a loan based on the value of the business’s assets—such as inventory, equipment, or accounts receivable.

How It Works

You secure a loan using the business’s existing assets as collateral. The lender gets repaid from future cash flow, or liquidates the assets if needed.

Pros

• No personal capital required
• Ideal for asset-rich businesses
• Fast approval compared to traditional loans

Cons

• Risk if assets underperform or depreciate
• Limited to businesses with significant tangible assets

Example

You buy a logistics company with $800,000 worth of trucks and contracts. A lender issues a $500,000 loan secured by these assets, covering the purchase.

5. Debt Assumption

What It Is

You take over the existing business debt as part of the deal, reducing or eliminating the need for a cash purchase.

How It Works

You negotiate with the seller and their lenders to assume responsibility for current business loans. This can be counted as part of the purchase price.

Pros

• Little or no cash required
• Keeps financing in place
• Sometimes faster than new financing

Cons

• You inherit existing liabilities
• Requires lender and seller cooperation

Example

The owner of a café owes $150,000 in business loans. You agree to take over the payments in exchange for 100% ownership—without any cash changing hands.

6. ROBS (Rollover for Business Startups)

What It Is

A ROBS allows you to use your retirement funds (like a 401(k)) to buy a business—without early withdrawal penalties or taxes.

How It Works

You create a C Corporation, roll your retirement funds into it, and use those funds to invest in your new company.

Pros

• No debt incurred
• Access to substantial capital
• IRS-compliant when done correctly

Cons

• Complex setup
• Risking your retirement savings
• Requires strict legal compliance

Example

You roll over $200,000 from your 401(k) to buy a specialty retail store. The transaction is handled legally via a third-party ROBS provider.

7. Equity Partnerships

What It Is

You bring on a financial or strategic partner to contribute the capital in exchange for equity in the business.

How It Works

You find an investor willing to fund the deal, and you offer them a percentage of ownership. You handle operations; they supply the money.

Pros

• Zero personal investment
• Access to smart money or mentorship
• Shared risk

Cons

• Shared decision-making
• Reduced ownership share
• Finding the right partner can take time

Example

You locate a profitable gym but need $250,000 to buy it. A former executive invests the capital in exchange for 40% equity. You run the business; they’re a silent partner.

Combining Strategies for Zero Out-of-Pocket Deals

Smart buyers often blend multiple strategies to acquire businesses with no personal capital. For example:

• SBA loan + seller financing for the down payment
  
• Earn-out + equity partner to reduce risk
  
• ROBS + asset-based lending to unlock liquidity and financing
  
  

At First Choice Business Brokers St Louis, we regularly help buyers structure creative combinations like these to close win-win deals—especially for those with drive but limited capital.

3 Common Mistakes to Avoid

1. Ignoring Due Diligence

Even if you’re putting in no money, don’t skip proper due diligence. You’re still taking on risk.

2. Overestimating Cash Flow

Don’t assume the business will instantly cover debt payments. Use conservative projections.

3. Poor Negotiation

Creative financing hinges on seller trust. If you lowball or push too hard, the deal can fall apart.

Conclusion: You Can Buy a Business with No Money—If You Know How

Buying a business with no money down in 2025 isn’t a pipe dream—it’s a strategy. With a mix of creative financing, clear communication, and professional guidance, you can take ownership of a thriving company without risking your own cash.

Want to explore your options with expert guidance? The team at First Choice Business Brokers St Louis can help you find and structure deals that work for your goals. Reach out today to get started on your acquisition journey.

Frequently Asked Questions (FAQ)