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Business Development Bank of Canada

Business Development Bank of Canada. TechExpo 2004. Business Development Bank of Canada. Who we are and What we do Consulting Services Financial Services Investment Services Venture Capital Subordinate Financing Where to find us. Who we are. Canada’s small business bank since 1944

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Business Development Bank of Canada

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  1. Business Development Bank of Canada TechExpo 2004

  2. Business Development Bank of Canada • Who we are and What we do • Consulting Services • Financial Services • Investment Services • Venture Capital • Subordinate Financing • Where to find us

  3. Who we are • Canada’s small business bank since 1944 • Self-sustaining crown corporation – profitable! • Play complementary role to all major commercial lenders • Over $8 Billion asset base – over $2 Billion in annual lending • 22,000 clients; Customer Satisfaction over 90% • Approx. 80 branches

  4. What we do Venture Capital Financial Services Consulting Group Subordinate Financing

  5. 5 BDC Consulting • Fully-customized value-added service offerings • Productivity, human resource management, quality, growth, export, e-business • BDC is a leading national provider of ISO (quality) consulting market • Fiscal 2003 achievements • Repeat business reached 46% • Completed 3,625 projects • Total revenues of $18.2 million

  6. Financial Services • Traditional term lending • 95% of the Bank’s overall lending activity • A number of different financial solutions but one common theme – money for viable businesses – NO GRANTS! • Two products to look at: • Innovation • Co-Vision

  7. Innovation Financing • To support Canadian Business that have opportunity for growth or process improvement but lack funds including MBO situations • A working capital loan with lower security requirements than term loans • Eligibility all BDC eligible clients • Loans up to $250K • Security against fixed assets not always required • Pricing ranges from 3.5 over our base rate and up based on company strength

  8. Co-Vision • To promote the creation of new viable businesses • New businesses • A business being established for the first time • An established business that has not registered 12 consecutive months of sales • Business Plan • Repayment over 6 years (includes 1 yr deferred payment) • >$50,000 – secured by fixed assets • <$50,000 – personal guarantee

  9. Investment Group: Venture Capital • One of largest VC groups in Canada • Established in 1975 • Over $400M in Assets • Invests in all stages of company lifecycles (seed through expansion • Focuses on: • Technology-based business • -High growth potential • Positioned to be a dominant player in their market

  10. Investment Group: Subordinate Financing • Mezzanine, Quasi-Equity, sub-debt, junior debt, etc… many different names but same common principal….. • Hybrid of debt and equity…depending on how it’s structured. • Subordinate refers to the fact that we are behind senior lenders.

  11. Sub-Debt (cont’d) • Provide clients with a flexible financing tool that has equity type properties without ownership dilution • Appropriate financing of growth opportunities can lead to greater profitability and viability • Looked on favourably by financial partners – often viewed as equity for covenant calculations • Competitive advantage in the market place. Look at deal sizes ranging from $250k - $5.0M first round • Partner with all other players • Not only high-tech focused

  12. Sub-Debt - Applications Sub-debt can be used in three different applications… • Growth Capital • Management buyouts/buy-ins • Mergers and acquisitions

  13. Conclusion • Our ONLY focus is growing and assisting Canadian Businesses • BDC tries to fill market gaps to meet the needs of Canadian Businesses

  14. Where to find us www.bdc.ca 1-888-INFO-BDC Visit the Branch at 55 Metcalfe

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