Rural Venture Fund

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Rural Venture Fund

  1. 2. Rural Venture Fund … Purpose To provide needed capital to an existing un-served market of small, growing, profitable North Carolina businesses with future job creation potential. The Fund will fill a gap that is not met by other organizations in the commercial banks, intermediary lending, venture capital or angel fund field.
  2. 3. Rural Venture Fund … <ul><li>Funding : </li></ul><ul><li>N.C. Rural Center : $2,500,000 </li></ul><ul><li>GoldenLEAF: $ 500,000 </li></ul><ul><li>N.C. General Assembly: $ 3,800,000 </li></ul><ul><li>Total Capital: $6,800,000 </li></ul><ul><li>UNC System: $75,000 </li></ul><ul><li>(Technical Assistance) </li></ul><ul><li> </li></ul>
  3. 4. Rural Venture Fund … <ul><li>Elements : </li></ul><ul><li>New source of equity-like capital for existing </li></ul><ul><li>businesses </li></ul><ul><li>Priority given to businesses in Tier 1, </li></ul><ul><li>economically distressed counties </li></ul><ul><li>Options range from subordinated debt to </li></ul><ul><li>equity deals </li></ul><ul><li>Terms of ROI less demanding; 5-10 yr plans </li></ul><ul><li>Range from $50,000 to $350,000 </li></ul>
  4. 5. Rural Venture Fund … <ul><li>Elements, cont’d : </li></ul><ul><li>Existing businesses only; no start-ups </li></ul><ul><li>Job growth potential required </li></ul><ul><li>Fund will collaborate with SBTDC and UNC </li></ul><ul><li>School System for intake and due diligence </li></ul><ul><li>Businesses agree to tailor-made package of </li></ul><ul><li>technical assistance as recommended by </li></ul><ul><li>SBTDC staff. </li></ul><ul><li>Packaging tranches from different funding </li></ul><ul><li>sources </li></ul>
  5. 6. Rural Venture Fund…
  6. 7. Rural Venture Fund … <ul><li>University Partners: </li></ul><ul><li>Western Carolina University </li></ul><ul><li>Appalachian State University </li></ul><ul><li>N.C. A & T University </li></ul><ul><li>N.C. Central University </li></ul><ul><li>N.C. State University </li></ul><ul><li>UNC Pembroke </li></ul><ul><li>East Carolina University </li></ul>
  7. 8. Rural Venture Fund … <ul><li>Fund Structure: </li></ul><ul><li>Two Advisory Groups </li></ul><ul><li>RVF Advisory Board </li></ul><ul><li>- consists of 7 individuals </li></ul><ul><li>- meets as needed to discuss Fund </li></ul><ul><li>progress </li></ul><ul><li>RVF Investment Committee </li></ul><ul><li>- consists of 7 individuals </li></ul><ul><li>- meets quarterly, or as needed, to review due </li></ul><ul><li>diligence and make deal recommendations </li></ul><ul><li>Investment decisions made by Rural Center </li></ul><ul><li>President and VP of Rural Development </li></ul><ul><li>Programs </li></ul>
  8. 9. Rural Venture Fund … <ul><li>Deal Structure Scenario: </li></ul><ul><li>Convertible Subordinated Mortgage Bonds </li></ul><ul><li>5 year interest only payments </li></ul><ul><li>Junior collateralization position </li></ul><ul><li>Ability to convert debt to equity after </li></ul><ul><li>specified time period </li></ul>
  9. 10. Rural Venture Fund … <ul><li>Outreach & Marketing: </li></ul><ul><li>Statewide regional sessions in operation </li></ul><ul><li>Sessions strategically located within </li></ul><ul><li>Tier 1 “clusters” </li></ul><ul><li>Collaboration with NCIF of The Conservation </li></ul><ul><li>Fund </li></ul><ul><li>Collaboration with SBTDCs </li></ul>
  10. 11. Rural Venture Fund … <ul><li>Contacts: </li></ul><ul><li>Don Stewart, Director </li></ul><ul><li>Cell: 919-605-5210 </li></ul><ul><li>[email_address] </li></ul><ul><li>Ashley Crane, Coordinator </li></ul><ul><li>Office: 919-250-4314 </li></ul><ul><li>[email_address] </li></ul>

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