Siddwell: capital advisor versus loan broker.

A business loan broker does not lend the money. NerdWallet's explainer makes that distinction plainly: the broker uses a network of lenders, and the loan comes from a lender. Brokers are often paid a fee. NerdWallet's comparison table puts the cost at a broker's fee of about 1% to 15% of the loan amount, and notes that sometimes the lender pays the broker rather than the borrower. There is no federal licensing requirement for business loan brokers; NerdWallet reports that only a handful of states require a license or specific disclosures. The explainer is Do You Need a Business Loan Broker?.

That fee is why the questions matter. A broker can be paid more for placing a more expensive product. NerdWallet says to ask, in writing, how the fee is charged, whether the broker earns more from particular lenders, how many lenders will see the application, and to walk away from anyone who guarantees approval or asks to be paid before the loan exists. Those are NerdWallet's questions. They are the right ones to ask any intermediary, including an advisor.

Capital advisory starts from the use of proceeds. Buying a company, buying the building you occupy, a construction project, equipment, working capital, a refinance, or a partner buyout. The company hires the firm. The books are reviewed. The lenders who finance that use of proceeds see the same deal at the same time. Banks, SBA lenders, private credit, equipment lenders, asset-based lenders. The structure you accept is the one that wins, not the one that called back first.

The pages for those uses start at acquisition financing. SBA 7(a) and 504 is a lender path inside the raise when the program fits. The SBA states that you apply with the lender, not with the SBA, and that the maximum 7(a) loan amount is $5 million. A fee schedule is not published on this site. What is published is the work.

Go to a lender directly when you already know the credit box you fit and you are prepared to compare more than one term sheet yourself. Use SBA Lender Match when you want an introduction to participating SBA lenders and you will take the application from there. The SBA's 7(a) page tells you to apply with the lender.

A loan broker can make sense, on NerdWallet's account, for a first-time borrower who wants someone else to find lenders and help with the application, and who has asked the fee questions above. It is a poor fit when you need the sale of the company run, or when the financing is one piece of a negotiated acquisition and the structure has to be argued, not just submitted.

Hire capital advisory when the financing is large enough, or complicated enough, that a single lender's first offer is the wrong way to set the terms. An acquisition with a seller note, a partner buyout, a refinance that should not be a rubber-stamped renewal, a project that needs both a construction loan and a takeout. The AI investment bank page explains the split between the banker and the software. Loan-broker software that submits applications is a tool for brokers. It is not this mandate.

Who makes the loan? If the answer is unclear, keep asking. How are you paid, by whom, and does any lender pay you more than another? How many lenders will see the deal, and will they see it at the same time? Will you guarantee an approval? A yes is a reason to leave. Are you a lender, a loan broker, or an advisor, and which licenses do you actually hold?

Siddwell's answers are short. The lender makes the loan. The firm is an investment bank, not a lender and not a licensed loan broker. A fee schedule is not on this site. The first call with the CEO costs nothing and is not a commitment.

Siddwell is an investment bank for privately held US companies doing about $1 million to $100 million in revenue. A banker owns the deal. Software does the volume: research, the list of buyers or lenders, first-draft materials, and document chasing. The calls, the negotiation, and the relationships stay with the banker.

Siddwell is not a lender, not a licensed loan broker, and not a business broker. Lenders fund loans. Buyers buy companies. If a direct introduction to SBA lenders is all you want, the SBA's Lender Match tool does that, and you apply with the lender.

If the only thing you need is a name of a lender, Lender Match or your own bank is enough. An advisor is the hire when the market should have to compete.