A new generation of finance.

• Author: Moore, Melissa
• Position: Alaska Growth Capital

Alaska Growth Capital operates much like a bank, but it doesn't accept deposits. Its main goal is to help Alaska businesses in the manufacturing, resource development, technology and tourism industries grow and prosper.

When Ron and Connie Boynton wanted to expand the sales and service portion of their business, Boynton Printing, they knew they'd have trouble getting a traditional bank loan.

The family owned business, located in Barrow, is fairly new-only about three years old. And they didn't have much to offer as collateral.

So they turned to David Hoffman at Alaska Growth Capital, which offers services traditional banks don't. Consulting, management assistance and networking opportunities are just a few of the added benefits of the lending company.

"Dave offered us services that we didn't get from other banks," Ron said. "He gave us a better overview of the business and (helped us determine) where we wanted to go. He helped to fine-tune it."

The Boyntons used their loan to hire and train two additional employees to help in the expansion of the sales and service they offer. Since receiving the loan, company sales have doubled, Ron said.

Boynton Printing is exactly the kind of business Alaska Growth Capital is designed to help. The lending institution looks to provide loans to businesses that have dedicated and experienced managers, and have a high potential for expansion, but are also considered hi-risk. Current loans generally range from $100,000 to about $600,000, but can go higher.

During the year that Alaska Growth Capital has been in business, the company has distributed more than $1 million to eight small businesses.

What is Alaska Growth Capital?

Alaska Growth Capital is a commercial financial institution that is licensed by the State of Alaska. It is not regulated the same as a bank, but instead operates as a Business and Industrial Development Corp., or a BIDCO.

BIDCOs were developed in the early 1980s to promote economic growth in Michigan during a severe recession in the auto industry. BIDCOs are private-sector financial institutions that are somewhat different from banks in that they can loan money as well as provide services to clients that can't normally be found in any bank, such as making equity investments in a growing business.

Nearly two decades after they were developed, 20 states have passed statutes implementing BIDCOs, including Louisiana and Texas. In 1992, the Alaska Legislature passed an act allowing BIDCOs in...