SBIC

SBICs Provide Financial Support and Stability

In 2001, we became a Business Development Company (BDC) and in 2002, we applied for, and received, a Small Business Investment Company (SBIC) license through the U.S. Small Business Administration (SBA). Under this program, Rand Capital SBIC, Inc. was formed as a subsidiary of Rand Capital Corporation. In 2017, we began working with the SBA to secure additional capital for further investing.

How do SBICs Work?

The Small Business Administration (SBA) licenses Small Business Investment Companies (SBICs) as part of a program designed to stimulate the flow of private debt and/or equity capital to small businesses. SBICs use funds borrowed from the SBA, together with their own capital, to provide loans to, and make equity investments in, concerns that have a net worth of less than $18 million and average net income of less than $6 million. The SBIC structure provides access to long-term, low-interest, fixed rate loans from the SBA that are not callable and are pre-payable without penalty. The structure also facilitates partnering with other investment firms, which increases deal sourcing avenues and adds stability.