Question 1

What is ROBS financing?

Accepted Answer

ROBS (Rollover as Business Startup) is an IRS-acknowledged, ERISA-compliant structure that lets a buyer use retirement funds (typically an old 401(k) or IRA of $50,000+) to fund a business acquisition without triggering early-withdrawal penalties or taxes on the rolled-over amount. The mechanics require a new C Corporation, a 401(k) plan inside it, a rollover of retirement funds into that plan, and the plan buying stock in the corporation. That is how the buyer's capital reaches the deal.

Question 2

Can I use my 401(k) to buy an MSP or IT services business?

Accepted Answer

Yes. If you have $50,000 or more in a 401(k), IRA, or other eligible retirement account from prior employment, ROBS lets you use those funds to acquire a business without early-withdrawal penalties or taxes. This is especially relevant for mid-career professionals moving from corporate roles into ownership of an MSP, cybersecurity firm, ERP consultancy, or dev shop.

Question 3

Does ROBS financing stack with SBA loans?

Accepted Answer

Yes, and this is the strongest capital structure available for a mid-market IT services acquisition. ROBS provides the equity portion of the deal using retirement funds; SBA financing provides the debt portion. The combined stack lets buyers with substantial retirement savings but limited liquid cash close larger deals cleanly.

Question 4

Who is Wolfspire's recommended ROBS provider?

Accepted Answer

Wolfspire recommends Guidant Financial for ROBS transactions. Guidant has completed more than 35,000 transactions since 2003, carries Lifetime Audit Protection on every plan (they hire and pay qualified ERISA counsel if the IRS or DOL audits your plan), keeps legal and plan administration in-house rather than outsourced, and is fluent in both ROBS and SBA financing.

Question 5

What other financing options exist for buying a tech services business?

Accepted Answer

In addition to ROBS and SBA loans, working capital options for existing businesses include revenue-based financing, term loans, and supplemental funding beyond traditional acquisition lending. Wolfspire maintains a curated set of provider relationships and will route referrals to the appropriate option based on the specific deal structure and business context.

Question 6

Why do most IT services acquisitions require financing?

Accepted Answer

Roughly 90 percent of the buyers in the IT services acquisition market need financing to close. The current wave of buyer-operator training programs all point to SBA financing as the standard answer. That advice is right but incomplete — ROBS is a complementary tool that most buyers do not fully understand and that dramatically changes the profile of who can afford your business.

How the buyers I know actually fund their deals.

Guidant Financial

Additional funding options — coming soon

Not sure which fits?