Lease secured
5-year lease executed Dec 2025, contingent only on financing close.
Anchor & Oak Coffee Roasters is a profitable, four-year-old specialty coffee roaster and café in Richmond, Virginia, requesting an SBA 7(a) term loan of $185,000 to open a second location in the city's growing Scott's Addition district.
The borrower has operated its flagship café and wholesale roasting line since 2022, generating $742,000 in trailing-twelve-month revenue with a 14.8% net operating margin. The requested financing funds a build-out of an established second storefront, equipment, and working capital. Projected debt-service coverage in Year 1 is 1.42×, comfortably above the SBA's 1.15× threshold, and is secured by business assets plus a personal guaranty from the principal.
A&O roasts single-origin and blended coffee in-house, supplying its own café plus 14 wholesale accounts across the Richmond metro. The existing location operates at 92% of seating capacity during weekday mornings, and wholesale demand exceeds current roasting throughput — the constraint this expansion relieves.
Combined with a $48,000 owner equity injection, total project cost is $233,000. The loan amortizes over ten years; existing-business cash flow alone covers debt service before the new location contributes a single dollar.
Anchor & Oak operates a dual revenue model — a retail café and an in-house roasting line serving regional wholesale accounts — that has compounded steadily since opening in March 2022.
The flagship at 2104 W. Main Street pairs a 28-seat café with a 12-kilo Loring roaster. Café sales (espresso, drip, pastry, light food) account for roughly 58% of revenue; wholesale bean sales to cafés, restaurants, and two local grocers account for the remaining 42%. Beans are sourced through direct-trade importers and roasted to order, which supports premium pricing and repeat wholesale contracts.
Opened March 2022 with $96,000 of owner capital and a $60,000 retired bank line. The original note was paid in full in 2025. The business has been cash-flow positive since month 7 and has grown revenue from $311K (2022) to a trailing-twelve-month $742K, with no outstanding long-term debt at the time of this request.
The specialty coffee segment continues to outpace the broader coffee category, and Richmond's Scott's Addition has become the region's fastest-growing mixed-use district — a defensible demand base for a second location.
Scott's Addition added more than 3,400 residential units and 40-plus food, beverage, and brewery tenants between 2020 and 2025, with daytime population swelling from office and creative-sector employers. The district currently has only two specialty coffee operators against an estimated daily demand of 1,900+ premium coffee transactions — a gap A&O's brand recognition is well positioned to close.
The existing customer base skews 25–44, professional, and repeat: 61% of café revenue comes from members of the loyalty program, indicating durable, recurring demand rather than foot-traffic dependence.
Café revenue varies ±9% seasonally; wholesale (42% of revenue) is contracted and stable, smoothing cash flow across the loan term.
The business is led by an owner-operator with direct industry experience and a tenured management bench — a primary mitigant against the operational risk of running two locations.
Both senior managers have been retained through prior growth and have signed two-year continuity agreements. A documented opening playbook from the 2022 launch is in place, shortening the new-site ramp and protecting cash flow during the build-out period the loan funds.
Loan proceeds are allocated to one-time, asset-building expenditures for the Scott's Addition location, with a working-capital reserve to fund operations through ramp-up.
Plus $48,000 owner equity toward security deposit, contingency, and pre-opening payroll. Total project: $233,000.
The new location mirrors the proven flagship model. The existing 12-kilo roaster is reaching capacity; the new equipment doubles roasting throughput, clearing the wholesale backlog and supplying both cafés from a single production schedule.
5-year lease executed Dec 2025, contingent only on financing close.
Health and zoning pre-cleared for food-service and roasting use.
Firm vendor quotes on file; 6–8 week lead time confirmed.
GC engaged; fixed-price build-out bid accepted at $65,000.
Projections use conservative assumptions — the new location reaches only 70% of flagship revenue by Year 2 — yet consolidated figures clear the SBA's coverage threshold in every year.
Secured by a first-position UCC-1 lien on all business assets and a full personal guaranty from the principal. Collateral coverage: 1.23× the loan.
Year-3 growth is driven by wholesale capacity, not new debt or additional locations. DSCR rises to 1.92× by Year 2 as the new site matures.
Anchor & Oak presents a profitable operating history, conservative projections, sufficient collateral, and an owner equity injection — the profile of a low-risk SBA 7(a) borrower expanding from strength.
Funds disbursed; equipment ordered; build-out begins under fixed-price GC bid.
Scott's Addition café opens; roasting capacity doubles, clearing wholesale backlog.
First full year closes above plan; debt service covered with margin to spare.
New site matures to 70% of flagship; coverage strengthens, balance amortizes.
Trailing cash flow covers the new obligation at 1.42× before the second location contributes a dollar. Secured by all business assets, a full personal guaranty, and a $48,000 owner equity injection, this is a conservative, collateralized request from a proven operator.