Session 02 · Capital Structure
DSCR Simulator
Adjust the inputs. Watch whether the business can service its debt.
Your P&L Starting Position
Revenue
$100.0m
Gross Profit
$30.0m
EBITDA
$5.0m
Business Parameters
Existing Debt
New Loan Request
Cash Flow Available for Debt Service (CFADS)
Covenant Dashboard
Covenant Bars
Bank Decision Simulator
✗ Loan Declined
DSCR of 0.15× signals the business cannot service this debt. The bank will decline. Try reducing the loan amount to ≤$0.0m, extending the term, or improving EBITDA margin.
Key Insight
A 5% EBITDA margin on $100m revenue gives just $5.0m of EBITDA. Even before new debt, your existing $20m at 6.5% costs $1.3m/yr in interest. The thinner your margins, the smaller your borrowing headroom — and the faster a revenue shock turns a passing DSCR into a breach. That’s why lenders stress-test before they lend.
Bank's DSCR-implied max loan
Request $10m is above covenant limit
$0m