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Who's Looking Good Now?

After the dotcom crash, low-tech businesses may see a funding surge.

This story appears in the August 2001 issue of Entrepreneur. Subscribe »

Until the bottom dropped out under the dotcom stampede, businessowners saw very few headlines about growth financing fortraditional low-tech businesses. But with high-flying techcompanies nose-diving, banks and firms seem to be notonly helping more established nondotcoms, but also proudlypublicizing the fact.

Huntington Capital, a San Diego-based SBIC just licensed by theSBA in January, has announced that its focus is primarily ongetting much-needed growth capital into the hands of smallbusinesses that have been around for at least two to 15 years andhave proven and consistently good margins. Thosecompanies, says Barry Wilson, president and CEO of HuntingtonCapital, have always had the hardest time getting cash. For onething, bankers often don't give entrepreneurs all they needbecause they don't have enough capital to satisfy thebank's loan-to-value ratios. And venture capitalists typicallydon't want to waste time on a million- or half-million-dollardeal when they could spend the same amount to raise $10 million or$50 million or more and get a much higher return.

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