C4 - The Terrace Standard, Wednesday, October 22, 1997

BDC helps small businesses _ successfully grow

Small businesses provide vitality, innovation and job creation tothe Canadian economy that ig unmatched by larger enterprises. Small busi- ness now accounts for half of all private sector employment in Canada and is creating the vast majority of new jobs,

The Business-Development Bank of Canada

(BDC) plays a key role in fostering the growth oft companies, especially those in emerging and export sectors, by offering a full range of innova- live financiat - products and management support.

"The BDC is here to help businesses grow at avery step of their development,” Says Fran~ois Beaudoin, the Bank’s President. and Chief Executive Officer. “Businesses: can meet new challenges and expand their horizons by using the tools our Bank offers.”

Working Capital For Exporters

The BDC's Working Capital For Exporters program largets companies that have identified opportunities for export sales but need addition- ai working capital to effectively exploit these new markets.

The program provides term Joans to help finance the preshipment needs of businesses-to a maximum of $250,000. The loans are avail- able ta businesses that have completed two full years of operalion, can demonstrate proven management capabilities, have slrong growth potential and are currently exporting or are on the verge of doing so.

Loans under this program are structured to ensure the long-term viability of the business. In

order to allow for foreign sales to bulld, principal -

payments may not be required for the first year in some cases with the full loan amount to be paid over four to six years.

Working Capital For Growth

Working Capital for Growth is aimed at solv- ing the problem many small businesses face in obtaining sufficient financing to take advantage of expansion opportunities or introduce new pro- ducts or services.

A Working Capital for Growth loan tops up available financing from existing lines of credit so companies can capitalize on solid growth opportunities. Loans under the program: are available to a maximum of: $100,000: These loans are avaliable for a wide range of growth- related initiatives and repayment terms are tai- lored to cash flow needs. in some cases, princi- pal payments may not be required ‘in the first year with the fullloan amounts to'be paid over four to seven years.

The program is designed for businesses that have been operating far al least lwo years and that have a line of credit: The companies also must have an accomplished management team and solid prospects for growth.

Patient Capital

The Patient Capital product is designed for growing new economy companies to support their early stages of cevelopment. These inno- vative businesses will have a leading-edge pro- duct or service that has generated initial sales and now need capital to grow,

Patient Capital loans can be used to support.

working capital needs, finance marketing and fimd intangible assets such as ISO accreditation and research and development, The loans pro- vide an “equity like” alternative, providing enter- prises with long-term capital under: flexible repayment! terms. The program is designed to recognize hard-to-value intellectual and intangi- ble assets.

As the program's name suggests, principal repayments can be postponed and interest capi- talized for up to three years until the business

begins to generate revenues. In most cases, Patient Capital loans are amortized over six to eight years and have a flexible price structure typically comprised of.a base interest rate plus a royally on sales, Initial loans can range from $50,000 to $250,000 with follow- “up | finance bringing the total to $500,000, ;

Venture Loans Venture loans are designed to meet the needs of companies that have established:earn-

ings. and a strong potential for growth and need -

more money to take’ on competitors, introduce new products or attack new markets, The pro- gram recognizes thal many growth-orlented

companies don't have the tangible assets

necessary for term loans.

Venture Loans’ are typically more than $100,000 and can go as high as $1 million. The loans are an innovative hybrid of traditional term loans.and venture capital, combining benefits of both debt and equity to meet the needs of grow- ing businesses, -

The. pricing structure is customized to the individual needs of the company and is a combi- nation of interest payments plus a.premium; usually:a royaltias on sales: The repayment schedule takes into account cash flow and the level ‘of working capital needed to operate the business. Thus, in some cases the start of prin- cipal and royalty repayment can be postponed for over a year. The normal amortization period is six to eight years.

Venture Capital

The 8DC has a long-standing commitment ta providing innovative small businesses with ven- ture capital, In fact, the Bank has invested more than $125 million in risk capital sinca 1983.

The BDC's venture capital investments are tallored to individual company needs. Typically, investments take the form of common or. pre- fered shares or convertible debentures and would-be a minority position, usually fram 10 to 49 per cent. ~nitial investments are usually in the range of $500,000 to $2 million and follow-up invest- ments as the company grows can bring the total commitment to as much as $5 million, BDC ven- ture investments are forward fooking and allow management to focus on long-term success, Three to ten years is the normal range of its

‘investments with most being held between four

and seven years. The Bank also has a proven track record of helping young companies to atiract capital from other sources.

Seed Capital

The Bank recently added a new Seed Capital fund to its diverse line of financial products offered to Canadian entrepreneurs. This Seed Capital fund will raise approximately $100 mil- lion. and is the first cross-country Seed Capital initiative to be launched in Ganada. The fund

aims to become the first link in the financing:

chain by investing in technolagical projects at the prestart-up phase, Conventional sources of capital have gener-

"ally considered the risk associated with develop-

ing an initial concept too high. At that early Slage, management consists of an embryonic team, uncertain. of technological feasibility and potential for substitutes. Haw the market will react to the innavation is unknown, as is the commercial viability of the product or concept.

The fund will.involve axperienced partners as well as a network of contacts in the worlds of R&D and venture capilal. The fund will work closely with universities and research tabs across the country and will utilize advisory com- miltees to assist in orienting activities to leading edge technologies.

Customers Feel Like Friends

it's not just the wide selection that makes Central Gifts synonymous with quality gifts and collectables in Terrace. It's the relaxed atmosphere that makes customers feel more like friends and family.0wner Sharalyn Palagian says that it's the warm atmosphere that draws people to her Store. “People like to come in because they're comfortable."Palagian is this year's president of the Terrace and District Chamber of Commerce and her commitment to the community is clearly evident.She says when other businesses thrive in the community, it’s more than likely that yours will also reap some of the benefits.Central Gifts’ staff are also key to her success."No business is successful just because the owner spends time there,” she says. “| have absolutely the best staff in the world.”

106-4716 Lazelle Ave

635-3334

Top Quality, Reasonable Prices

Top quality equipment at reasonabte prices.

If you think thal goal is out of reach in the northwest, then you

haven't been to Sight and Saund lately.

Sight and Sound's Keith Avenue showroom has everything for your home and car audio needs, plus a complete line of musical instruments that will please even the most discriminating

musician.

“We have a great selection of musical instruments featuring all the name brands,” says Sight and Sound’s owner Gord McConnell, ~*We even have a music sound room 50 you can try

out the various instruments in comfort."

And for those who would rather just listen to the music, Sight and Sound has a huge selection of leading edge electronic equipment from name brands tike Sony, Ploneer, JVC and Cenon. |

You can even take the tunes on the road with a quality car stereo fram Sight and Sound. Alpine and Rockford are Just two of the Inany name brands available — custom installed In any vehicle.

Alan Wagner -

Don’t forget to check out their surround sound demonstration room to hear the latest in stereo sound!

. Keith Ave 5

SIGHT<é SOUND

635-5333

Treating Small Business Like Family Members...

A comment we very often hear when someone becomes a member of our credit union its, “People bere treat you just like

family”

We are like family, We take pride in the fact that our only purpose is to serve our members’ financial needs.

that’s the credit Union advantage. Join our family of families. Become a member today.

Terrace & District Credit Union Salutes Small Business Week!

Terrace & District Credit Union

We belong to you," #

the credit union advantage: we are a profit sharing, member owned institution... we belong to pots,