Alternative Venture Finance: Federal Grants and LoansWritten by Dave Lavinsky
While most companies seeking venture capital initially think about angel investors and venture capitalists, a large alternative source of financing is federal grants and loans. The two largest federal grant programs are run by Small Business Administration (SBA), and by Small Business Investment Companies (SBICs).An SBA loan, regardless of whether it is a direct loan from SBA, or, as is more common, a bank loan guaranteed by SBA, is essentially a bank loan. The benefit of it versus a traditional bank loan is rate. SBA rates are typically much less than traditional business loan rates. In most cases, in a guaranteed SBA bank loan, SBA guarantees 90 percent of loan will be repaid to bank. As such, banks are at much less risk than in most other loans, and are a bit more flexible with regards to who they offer these loans. However, SBA usually requires founders of company to personally guarantee loans, which makes them risky should venture collapse. Alternatively, Small Business Investment Companies (SBICs) are privately organized corporations that are licensed and regulated by SBA. Small or emerging businesses which qualify for assistance from SBIC program can receive equity capital and/or long-term loans from these companies. Essentially, these companies provide their own capital, which is supplemented by federal funds, to companies they fund.
| | Stock Market InvestmentsWritten by Charles M O'Melia
You have permission to publish this article either electronically or in print, free of charge, as long as author bylines are included. A courtesy copy of your publication would be appreciated. Please email to mailto:charles@thestockopolyplan.com (Word Count 324)Stock Market Investments If there is one term over-used when talking about making investments in stock market I would think that term would be: buy low, sell high. Buy low? Sell high? How low is low and how high is high? I like term buy low; sell dear, much better! But better still are terms buy and hold, and dollar-cost-averaging (buying same stock at different prices through years). For within those two stock market terms, in my opinion, lies path for successful stock market investments. For me, if a buy and hold strategy is used, then I want to be paid for using it, and if a dollar-cost-averaging strategy is used, I don’t want to be charged commission fees for future dollar-cost-averaging purchases. Therefore, in order to be paid for buy and hold strategy companies purchased must pay me every 3 months. If a company cannot pay me every 3 months for buying and holding their stock, then I don’t want to buy and hold their stock. The payment is called a dividend, and dividend varies with each buy and hold company owned. This buy and hold strategy co-exist with dollar-cost-averaging. The monies paid by company every quarter through buy and hold strategy is used to purchase more shares of their company. The company does this commission-free, and is automatic every quarter through years of ownership.
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