Enterprise-secured debt is not qualifying E-2 capital. The actual financing structure matters even if the overall purchase appears substantial.
Use the real security agreement
A high total cannot remove a financing limitation.
Funds and assets irrevocably committed to the enterprise and genuinely exposed to loss, including a purchase price paid or held in escrow for release, unrecoverable start-up spending, and equipment bought outright. Write down the purchase or startup budget item by item, covering premises, equipment, inventory, licences, initial payroll and working capital, and mark which items are already paid, contracted, or merely intended. Substantiality is assessed proportionally: the amount invested is compared with the total cost of establishing a business of this kind, and the proportion must be high enough to show the investor’s financial commitment and the likely success of the enterprise. A dealership with a purchase price, working capital and initial inventory requirement of several hundred thousand dollars would generally expect the buyer to have committed most of that amount, whereas a very large business can qualify with a smaller proportion. Beyond the investment itself, budget for legal work on the purchase agreement and the note, accounting review of the seller's records, valuation where the price is negotiated, and the application costs applicable to the route chosen.