SMBash 2026: The Playbook Has Quietly Rewritten Itself

We spent three days at SMBash this week. Irving, Texas. A roomful of self-funded searchers, operators, investors, and lenders who have actually closed deals, plus the hallway conversations between sessions. The content was good. The hallway conversations were better. A handful of EBIT Community members were in the room, and those conversations held up against anything on the main stage.

What made this year different from other events we have been to: the ecosystem has quietly rewritten the playbook, and most searchers have not noticed yet. This recap is based on session presentations, speaker talks, and conversations with attendees during the event. Here are five things we heard across the sessions that, taken together, describe what is actually working right now.

Jacob Hall of Kando Capital opened with what he called the Four Horsemen of ETA. The first one sets up the rest. Max leverage worked when prime was 3.25%. It does not work when prime is near 7% and SBA rates sit between 8% and 10%.

The typical self-funded stack has not changed much: 80% senior debt, 10% seller note, 10% equity. With a DSCR minimum of 1.25, Hall argued, that stack has effectively zero margin for error. One key customer churns. One key employee leaves. One insurance renewal comes in 40% higher than modeled. The business goes red, and the personal guarantee sits directly underneath.

Hall's framing was sharp. In 2021, cheap debt absorbed your mistakes. In 2026, it amplifies them.

The other three horsemen followed the same logic. Overpaying in a hot broker process was forgivable when a half-turn stretch got erased by multiple expansion at exit. Today that same half-turn sits on the operator for ten years at 9% or higher. Hockey-stick models that baked in year-two margin expansion and year-three multiple expansion mistook a 2021 market tailwind for strategy. And going it alone, which was a perfectly viable path when diligence timelines were generous, now puts first-time buyers against sellers with hundreds of process reps.

The working rule from Hall's session: if your model needs three things to go right to pencil, your model has a problem. Don't make money on the sale. Make money on the buy.

For the full picture on today's rate environment, we broke the math down in SBA Loan Rates & Fees 2026.

Athena Simpson of AcquiMatch opened her session with a number that made the room quiet. In her framing, 98% of people who say they want to buy a business never close one.

Simpson's funnel math: 10,000 listings scanned produces roughly 500 matches, 152 NDAs signed, 100 CIMs reviewed, 23 serious conversations, 4.3 LOIs sent, and 1 signed LOI. Most first-time searchers, she noted, need two or three signed LOIs before one closes. Realistic timeline: 12 to 18 months, not 3 to 6.

Inside those numbers is the thing most searchers miss. The single biggest predictor of whether an LOI lands, according to Simpson, is not price. It is not thesis. It is velocity. The winning LOI and the losing LOI are separated by five days on average.

Five days. That is the entire edge.

Which means the buyers who close are the ones who built the systems before the first deal arrived. A professional email address. A real buyer profile, not a generic "Holdings" or "Ventures" shell. A pipeline tool that is actually being used. Financial modeling templates that can spit out a credible offer in 48 hours. A pre-qualification letter from a lender who has already pre-flighted the deal type.

Simpson's other point is one we keep hearing and keep seeing searchers ignore. Most deal boxes are identical. $500K to $900K SDE, stable revenue, recurring customers, owner out of day-to-day. Everyone is searching for the same business, and that business is priced accordingly. The buyers who win build a deal box that matches their actual superpowers. If you can sell, weight toward businesses where the owner was the sole salesperson. If you grew up in manufacturing, you have an edge in industrials a generalist cannot replicate.

Your deal box is not your edge. Your edge is your edge.

If you are still scrolling BizBuySell every night without a matching process, how to source off-market deals in the age of AI is worth a read.

Peter Lehrman, CEO of Axial, walked through something most searchers do not see from the outside. According to Lehrman's data from the Axial platform, only 35% of deals get sent to 100% of recommended buyers. The other 65% run through a selective, private process.

Read that again. The majority of quality lower-middle-market deals are getting routed by sell-side advisors to a short list of buyers they already know, trust, and want to work with.

Axial's inquiry acceptance rates tell the same story. Family offices get roughly 60% acceptance. Strategic acquirers, roughly 55%. Search funds, roughly 45%. The tiering is real. Moving up it requires giving brokers a reason to remember you.

Lehrman's examples of buyers who win without being the highest bid: a former Bain consultant who beat 17 other buyers, including eight search funds, by attending the target's trade show, naming the founders in the LOI, and writing that he had walked into their booth to admire the products. A searcher named Griffin Schultz who outmaneuvered nine family offices and 40-plus buyers through messaging and founder connectivity alone.

The through line: industry-agnostic generalist searchers are the hardest for brokers to place, the hardest for sellers to remember, and the hardest for themselves to build a flywheel around. Lehrman pointed to Sam Rosati, one of the SMBash hosts, as now the top ChatGPT result for fencing business acquisitions, because he picked a lane and stayed in it. Bill d'Alessandro is synonymous with pet brands. Kyle Tucker, pizza. You do not need to own a vertical. You need to be unforgettable in a small one.

Brokers do not reward the biggest offer. They reward the cleanest close from a buyer their seller will not embarrass them with later. Our full playbook on this is in How to Work With a Business Broker as a Buyer.

The SBA financing panel with Jared Johnson of First Internet Bank, Matthias Smith of Pioneer Capital Advisory, and Matthew Dolsky of Byline Bank was the session I heard the most hallway chatter about afterward, and for good reason. The panelists walked through two policy shifts from the last year that have reshaped how self-funded deals get done.

First: the US citizenship requirement tightened. Green card is no longer sufficient. That has removed a generation of high-performing searchers from the funnel. Second: seller equity rollover mechanics changed. Sellers can no longer simply roll equity. They must retain it, with a two-year guarantee requirement. Structures that worked cleanly in 2024 do not clear today.

What the panelists were consistently saying, across the hour:

Rate is not the deciding factor. Certainty of close is. The right question to ask a lender is not "what is your rate." It is "how often do you issue term sheets you do not follow through on, and why?" Followed by "how many search deals have you closed in the last twelve months?" and "has this been pre-flighted with your credit committee?" The answers separate the lenders who run on marketing from the ones who run on reps.

Lenders evaluate whether you have earned the right to borrow $4M. One panelist framed it this way: personal financial discipline predicts business financial discipline. A mid-level earner with strong savings history beats a high-wage earner who has not managed debt responsibly. Industry experience transfers, even indirectly. Mechanical engineering into a manufacturing acquisition is fine. Walking into a licensed trades deal without knowing how the RME (responsible managing employee) requirement works will get your file shelved.

The seller note structure the panel recommended is longer than most searchers think. Two-year full standby with no principal or interest during that window. Eight-year amortization following standby. A balloon at year four with a re-amortization option through the bank if you are current on SBA payments. Fast amortization, like 36 months, is often worse than no seller note, per the panel, because it strangles cash flow exactly when the business needs it most. We went deeper on this in How to Structure Seller Financing Under the New 2025 SBA Rules.

Lenders are not underwriting deals. They are underwriting people who happen to have a deal. Every conversation is part of the file. Every email. The panel's collective preference for experienced deal bankers with, in their words, some gray hair, is not accidental. They have seen the second-order effects of first-time buyer mistakes play out across hundreds of files.

Jay Paul Henderson's session on AI for Search was the one most searchers probably underestimated on the agenda and will most regret missing.

Henderson's framing: seven levels of AI adoption in a business. Level 1 is using ChatGPT like a fancier Google. Most people stop there and miss 95% of the actual value. Level 2 is learning how to prompt properly: role plus audience plus task plus tone plus limits. Level 3 is building persistent projects so you stop re-explaining your business every time. Level 4 is when the mindset shifts from "what can ChatGPT do" to "what is the best tool for this problem," and agents start doing work while you sleep. Level 5 is building your own internal tools with coding agents because nothing off the shelf solves your specific problem. Level 6 is rebuilding the operating system of the business around AI. Level 7 is aspirational: running a full organization with effectively one person in the loop.

The case study that stuck in the room: MEDVi, a telehealth company in LA, was described by Henderson as having reached $400M in revenue with one employee before hiring a second. 2026 projections, per the session, put them at $1.2B. Not normal. But no longer impossible to imagine.

The stat that mattered more to the average operator in the room, according to Henderson: businesses using AI are reporting 5.6 hours saved per employee per week. Managers are reporting 7.2 hours. That is roughly an extra workday every week.

And the owner-versus-owner framing that stopped the conversation for a minute: Owner A has been in business twelve years, works sixty-hour weeks, answers every email personally. Owner B started eleven months ago and runs AI agents for quoting, customer communication, scheduling, and follow-up. In Henderson's telling, Owner B has already caught Owner A.

In 2026, the person with eleven months of AI leverage catches the person with twelve years of hard work. The tools are the same. The level of use is not.

For searchers, this changes what a first 100 days actually looks like. The new owner who walks into a business with fifteen-year-old processes and an AI playbook already loaded has a structurally different operating position than the owner who walks in with a clipboard.

A few patterns repeated across every session, every hallway conversation, every dinner.

Get narrow. The ecosystem has too many generalists chasing identical deal boxes. The winners have something recognizable to the market.

Respect the rate environment. A half-turn stretch in 2021 was a rounding error. In 2026 it is a decade of debt purgatory.

Build the systems before the first deal. Pipeline, model, pre-qual letter, buyer profile, AI workflows. The five days that separate winning and losing LOIs live inside those systems.

Find partners, not just capital. Nearly every searcher we spoke to who has closed multiple deals had someone senior sitting next to them through every major decision. The ones going it alone are running a higher-difficulty game than they realize.

Start climbing the AI ladder this week. Pick one workflow. Automate it by Friday. The gap between operators who compound with AI and those who don't is widening fast.

The buyers closing deals in 2026 are not smarter than the buyers who closed in 2021. They are more systematic, more specific, and more present for the person on the other side of the table. That is the real shift. Everything else is detail.

SMBash was the right mix. Real searchers with closed deals sharing real numbers. Lenders who fund the space rather than market to it. Operators running actual portfolios. Investors who have seen enough cycles to have opinions. The hosts, Sam Rosati, Kevin Henderson, and David Brackett, have built one of the few events in this ecosystem where the content and the people are both worth the flight.

If you were there, we would love to hear what landed for you. If you were not, the sessions will be worth your time when the recordings go up.

Disclaimer: This guide is for educational purposes only and does not constitute legal, financial, tax, or investment advice. Business acquisitions involve significant risks, and outcomes can vary widely based on individual circumstances. Always consult with qualified professionals including attorneys, CPAs, and financial advisors before making acquisition decisions. The EBIT Community does not guarantee the accuracy of information provided or the success of any acquisition strategy. Past performance and examples do not guarantee future results.