The SBA also licenses for-profit intermediaries, known as Small
Business Investment Companies (SBICs). SBICs are privately owned
venture-capital firms that invest their own capital, along with
money they've borrowed at favorable rates from the government.
If you think working with venture-capital investors will get your
business off the ground--and you don't mind giving up some
equity--ask about SBICs. In addition to helping you finance your
business, some SBICs also offer management services. Because they
take a vested interest in companies they invest in, they look at
everything from inventory to cost control, hiring practices and
location. Some SBICs only lend in industries they know; others will
lend across the board.
Your head may be swimming now with all these acronyms, but you
should also know about Specialized Small Business Investment
Companies (SSBICs), which serve socially and economically
disadvantaged entrepreneurs by investing in companies owned in
economically depressed areas, and those owned by women and
minorities.