(a) EligibilityA company shall be eligible to apply to participate, as a New Markets Venture Capital company, in the program established under this part if—
the company is a newly formed for-profit entity or a newly formed for-profit subsidiary of an existing entity;
the company has a management team with experience in community development financing or relevant venture capital financing; and
(b) ApplicationTo participate, as a New Markets Venture Capital company, in the program established under this part a company meeting the eligibility requirements set forth in subsection (a) shall submit an application to the Administrator that includes—
information regarding the community development finance or relevant venture capital qualifications and general reputation of the company’s management;
a description of how the company intends to work with community organizations and to seek to address the unmet capital needs of the communities served;
a proposal describing how the company intends to use the grant funds provided under this part to provide operational assistance to smaller enterprises financed by the company, including information regarding whether the company intends to use licensed professionals, when necessary, on the company’s staff or from an outside entity;
with respect to binding commitments to be made to the company under this part, an estimate of the ratio of cash to in-kind contributions;
a description of the criteria to be used to evaluate whether and to what extent the company meets the objectives of the program established under this part;
information regarding the management and financial strength of any parent firm, affiliated firm, or any other firm essential to the success of the company’s business plan; and
such other information as the Administrator may require.
(c) Conditional approval
(1) In general
(2) Selection criteriaIn selecting companies under paragraph (1), the Administrator shall consider the following:
The likelihood that the company will meet the goal of its business plan.
The experience and background of the company’s management team.
The need for developmental venture capital investments in the geographic areas in which the company intends to invest.
The extent to which the company will concentrate its activities on serving the geographic areas in which it intends to invest.
The likelihood that the company will be able to satisfy the conditions under subsection (d).
The strength of the company’s proposal to provide operational assistance under this part as the proposal relates to the ability of the applicant to meet applicable cash requirements and properly utilize in-kind contributions, including the use of resources for the services of licensed professionals, when necessary, whether provided by persons on the company’s staff or by persons outside of the company.
Any other factors deemed appropriate by the Administrator.
(3) Nationwide distribution
The Administrator shall select companies under paragraph (1) in such a way that promotes investment nationwide.
(d) Requirements to be met for final approvalThe Administrator shall grant each conditionally approved company a period of time, not to exceed 2 years, to satisfy the following requirements:
(1) Capital requirement
(2) Nonadministration resources for operational assistance
(A) In generalIn order to provide operational assistance to smaller enterprises expected to be financed by the company, each conditionally approved company—
(i) shall have binding commitments (for contribution in cash or in kind)—
from any sources other than the Small Business Administration that meet criteria established by the Administrator;
payable or available over a multiyear period acceptable to the Administrator (not to exceed 10 years); and
(ii) shall have purchased an annuity—
using funds (other than the funds raised under paragraph (1)), from any source other than the Administrator; and
that yields cash payments over a multiyear period acceptable to the Administrator (not to exceed 10 years) in an amount not less than 30 percent of the total amount of capital and commitments raised under paragraph (1); or
shall have binding commitments (for contributions in cash or in kind) of the type described in clause (i) and shall have purchased an annuity of the type described in clause (ii), which in the aggregate make available, over a multiyear period acceptable to the Administrator (not to exceed 10 years), an amount not less than 30 percent of the total amount of capital and commitments raised under paragraph (1).
(B) ExceptionThe Administrator may, in the discretion of the Administrator and based upon a showing of special circumstances and good cause, consider an applicant to have satisfied the requirements of subparagraph (A) if the applicant has—
a viable plan that reasonably projects the capacity of the applicant to raise the amount (in cash or in-kind) required under subparagraph (A); and
(e) Final approval; designationThe Administrator shall, with respect to each applicant conditionally approved to operate as a New Markets Venture Capital company under subsection (c), either—
(1) grant final approval to the applicant to operate as a New Markets Venture Capital company under this part and designate the applicant as such a company, if the applicant—
satisfies the requirements of subsection (d) on or before the expiration of the time period described in that subsection; and