Business Development Company - BDC

AAA

DEFINITION of 'Business Development Company - BDC'

A company that is created to help grow small companies in the initial stages of their development. BDCs are very similar to venture capital funds. Many BDCs are set up much like closed-end investment funds and are actually public companies that are listed on the NYSE, AMEX and Nasdaq.

INVESTOPEDIA EXPLAINS 'Business Development Company - BDC'

To qualify as a BDC, companies must be registered in compliance with Section 54 of the Investment Company Act of 1940. A major difference between a BDC and a venture capital fund is that BDCs allow smaller, non-accredited investors to invest in startup companies. Some of the reasons why BDCs have become popular is that they provide permanent capital to their management, allow investments by the general public and use mezzanine financing opportunities.

RELATED TERMS
  1. American Stock Exchange - AMEX

    The third-largest stock exchange by trading volume in the United ...
  2. Angel Investor

    An investor who provides financial backing for small startups ...
  3. Closed-End Fund

    A closed-end fund is a publicly traded investment company that ...
  4. Venture Capital Funds

    An investment fund that manages money from investors seeking ...
  5. Venture Capital

    Money provided by investors to startup firms and small businesses ...
  6. Mezzanine Financing

    A hybrid of debt and equity financing that is typically used ...
Related Articles
  1. Investing

    5 Tips For Investing In IPOs

  2. Investing

    What's the difference between publicly- ...

  3. Retirement

    IPO Basics Tutorial

  4. Entrepreneurship

    A Look Into The Secrets Of Venture Capitalism

Hot Definitions
  1. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  2. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  3. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  4. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  5. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center