Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

What program was created to provide growth capital needs for small businesses?

1. Small Business Investment Company (SBIC)

2. Small Business Administration (SBA)

3. Entrepreneurship Development Program

4. Venture Capital Fund

The correct answer is: Small Business Investment Company (SBIC)

The Small Business Investment Company (SBIC) program was specifically designed to address the growth capital needs of small businesses. This initiative allows private investment firms to provide equity and debt financing to small enterprises, enabling them to expand and develop. By leveraging both private and government capital, SBICs are able to support the unique financial requirements of growing businesses, which often encounter challenges in accessing adequate funding through traditional lending channels. The Small Business Administration (SBA), while also supportive of small businesses, serves a broader role by providing various loan programs, guarantees, and grants, rather than focusing specifically on growth capital needs. The Entrepreneurship Development Program aims to foster entrepreneurial skills and training but does not deal directly with the provision of capital. The Venture Capital Fund is more broadly associated with high-risk investments and may not exclusively cater to small businesses or their specific growth capital needs. The SBIC's tailored approach makes it a crucial resource for small business financing.