Venture Capital
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Growing companies with 'patient' capital Rural Venture FundThe Rural Venture Fund offers capital for small businesses seeking to expand in North Carolina's poorest counties. The investments carry the expectation of a return, but on less demanding terms and over a longer period of time than available with traditional business financing. Through their growth, qualifying businesses will help create jobs and build wealth where they are needed most.
Frequently asked questionsWhat kind of investments do you make?What makes you different from other venture capitalists? How much money could my company get? And if I need more than that? What kind of collateral do you require? What other terms are attached? My company isn't doing well, but I know if I just keep it going a little longer, it will take off. Can you help? Will you lend me money to buy a business? How do I know if I qualify? How long does it take to get a decision? Who makes the decision? How do I apply? What if I decide I don't want a loan? If I apply, who else will see it? What is the Venture Fund? We offer investments in the form of subordinated debt. Subordinated debt is similar to a second mortgage. You borrow some money from us and some from another source, and we agree to be the subordinate lender. The other lender (or lenders) will have first rights to collateral or security, which means we bear the higher risk. Return to top What makes you different from other venture capitalists? First, our focus is on the rural places where traditional venture capitalists are least likely to see big profit potential. Second, patience. Most venture capitalists take equity in a company with an eye toward making a big return when the company goes public or is sold. They generally expect to see that big return in a short period of time. We anticipate a five-year growth period. And finally, while we do expect a return on our investment, our expectations are lower than those of a traditional investor — in the range of 15 percent instead of 30 percent or more. Return to top How much money could my company get? From our program, up to $350,000. We specifically target companies needing between $100,000 and $350,000. Return to top And if I need more than that? Many of our investments involve multiple partners, each putting up a share of the total needed. These partners may be traditional banks or government or nonprofit programs. Return to top What kind of collateral do you require? We generally do not require collateral, though depending on the risk taken, it may be considered. In all cases, however, we require a personal guarantee of the loan by the borrower. Return to top What other terms are attached? We consider our "terms" to be advantages for you. When we make an investment, we naturally have an interest in your success. So we've set up a partnership with the UNC System to help you manage your company for long-term growth. The university's Small Business and Technology Development Center and several UNC business schools help by providing specialized technical assistance to you and to the fund itself. We also require that you submit quarterly and annual financial reports. Return to top My company isn't doing well, but I know if I just keep it going a little longer, it will take off. Can you help? The Rural Venture Fund is meant for already established and profitable businesses. Because of the debt service attached to the program, a company struggling to make ends meet is not a good fit. Return to top Will you lend me money to buy a business? This is possible — if you already have management experience in the industry in which you wish to purchase the business. Return to top How do I know if I qualify? For starters, to be eligible for the Rural Venture Fund:
Furthermore, we focus on companies in counties designated Tier 1 by the N.C. Department of Commerce. Businesses in those counties will receive priority consideration. Businesses located in urban counties or Tier 3 counties are not eligible. Beyond that, the best way to see if you qualify is to apply. Business Finance Office N.C. Rural Economic Development Center 4021 Carya Drive Raleigh, NC 27610
ContactThis e-mail address is being protected from spambots. You need JavaScript enabled to view it Underwriter, Rural Venture Fund N.C. Rural Economic Development Center 4021 Carya Drive Raleigh, NC 27610 Telephone: 919-250-4314 Fax: 919-250-4325 |