Small Business Encyclopedia

Category: Financing

CDC-504 Loan

An SBA loan program that provides long-term, fixed-rate loans of up to $1 million for financing fixed assets, such as land and buildings

Collateral

The asset(s) used as security in order to obtain a loan

Bank Relationship

The rapport you establish with the bank with whom you conduct business transactions, which could help smooth the way when it comes to loan applications or special requests

Bootstrapping

To finance your company's startup and growth with the assistance of or input from others

Direct Public Offering (DPO)

A situation in which a company sells its shares directly to the public without the help of underwriters

Initial Public Offering (IPO)

The first sale of securities (almost always as stock) in a corporation under the regulations governing a public company

Export-Import Bank

An independent bank established by Congress that finances or insures foreign purchases of U.S. goods for customers unable or unwilling to accept credit risk.

Microloan

A SBA loan program that helps entrepreneurs get very small loans, from less than $100 to $25,000

Venture Capital

Funds flowing into a company, generally during pre-IPO process, in the form of an investment rather than a loan. Controlled by an individual or small group known as venture capitalists, these investments require a high rate of return and are secured by a substantial ownership position in the business.

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