Business Development Companies

What they are
Business Development Companies (BDC) were first authorized as a corporate entity in the United States by Congress in 1980. They were intended to aid in providing capital to small and medium sized companies that lacked adequate access to financing through banks or the public market

Structure
As a rule, BDC's are set up as closed-end funds, and are regulated. Additionally, they must meet the following requirements:


 * 1) Invest at least 70% of assets in specific types  of investments.
 * 2) Provide managerial assistance to the companies within their portfolio.
 * 3) Meet asset diversification tests.
 * 4) Distribute almost all net investment income to shareholders on an basis.

Notes:
1. recently profiled in Kiplingers.

2. AAII seems to like this one.

3. Small Business Investment Company Loans