Business Development Company - BDC
Categories: Entrepreneur, Company Management, Regulations
A Business Development Company (BDC) works like a venture capitalist to invest in and help small and medium size businesses that are in the initial stages of their existence.
They were created in 1980 by the U.S. Congress in order to encourage job growth and help small businesses grow. BDCs are publicly traded companies whose stock is available to anyone, as opposed to venture capitalist firms that are run by large institutions or wealthy private investors.
With BDCs, anyone in the general public can invest in start-up companies, most of which are privately held. Small and medium size businesses enjoy having ongoing capital invested in them, and the BDCs are also supposed to dispense free advice to their companies. Since they have to distribute 90% of their profits to shareholders, an investor can get some good dividend yields from BDCs, but they also involve some risk, as start-up companies...don’t always survive.
