The Coalition for Business Development (CBD) is a member-driven, Washington-based trade association that advocates exclusively on behalf of business development companies (BDCs) to expand their ability to provide necessary growth capital to small- and middle-market Main Street businesses so they can expand, invest, and create jobs. The CBD is the successor to the Coalition for Small Business Growth, an ad-hoc coalition of BDCs that in 2018 secured passage of the Small Business Credit Availability Act, produced research and data on the BDC industry, and championed modernization of decades-old BDC regulation.
Driven by the vision and input of our members, the CBD’s mission is to increase awareness of the value of BDCs to Main Street businesses among legislators, regulators, and media; to promote federal policy changes that enable BDCs to expand their lending; and to conduct and publish research on the efficacy of BDC activities and regulation.
There are hundreds of thousands of small- and middle-market enterprises (SMEs) employing millions of people across the country that are eager for capital to expand, innovate, and hire. Until 2018, the BDC regulatory regime had not been meaningfully updated since it was enacted in 1980. In 2018, CBD members successfully demonstrated to lawmakers the benefits of allowing BDCs to enhance their borrowing and lending abilities, which culminated in the enactment of the Small Business Credit Availability Act. While this change in law has been effective, more modernization of the BDC regulatory regime is needed to ensure BDCs can help Main Street businesses grow and thrive. These changes include:
Harmonizing the SEC’s treatment of BDCs with its treatment of other operating companies under its “Acquired Fund Fees and Expenses” (AFFE) Rule.
Ensuring BDCs have access to prudent risk management tools under appropriate accounting principles.
Removing artificial barriers to investment in BDCs by certain sources of capital so that BDCs have access to a sufficiently liquid market for their orders.