Hercules Technology Growth is living up to its name - Silicon Valley / San Jose Business Journal:

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Observers say the firm's aggressivwe strategy to lendto high-risi early-stage, venture capital-backed companies and its solix relationships with venture investors has helped buile the value of its loan portfolio beyonsd $530 million in just four years, whild traditional financiers tighten lendingh standards and struggle to grow revenue. And Herculexs says the credit crunchn might just be playing tothe firm's Hercules posted record revenud in the fourth quarter of 2007 of $15.8 an 82 percent increase over 2006. The companty grew its net incomew by 424 percentto $20.67 million. For the year, the company grew net incoms in 2007 by 273 percentto $42.4 million.
And it loaned out $367 Hercules credits several factors for its record venture capital raised and investedin 2007, a lengtheningg of venture-backed companies time to exitsx and the volatile capitak markets that make public offerings more risky. "Those are the interestintg phenomena that really bode well forour business," says Herculesx CEO Manuel Henriquez. The firm says it's builtr an aggressive team that has helpefd it win more deals likeits $15 million loan announced Jan.
29 to 30-million-user social network hi5 Hercules has positioned itself to bea front-runner in high qualityh deals by the relationships its forged with venture capitalists, says Dave a partner at Mohr Davidow Ventures and a boare member of hi5. Since Dec. 2, the firm has announced $94 milliom in financing to venture-backed "They're looking for a sort of blue chip VC firm to have made a reasonabld investment intothe company," Feinlib says. "We'vd certainly done tons and tons of due diligence in the companiese that we invest inand they're leveragingf that.
" Hercules is set up as a business development company, which requires it to distribute 90 percent of its taxablee income as dividends but exempts the company from payingv corporate income tax. That helps the firm compets onloan rates, Henriquez Competition among venture debt which include commercial banks such as Siliconh Valley Bank, and Square 1 has heightened over the last several yearx as venture capital money has continued to flow here.
"Ventur debt providers have become more aggressivw lately and are providing better termson debt," says Ian Patricm Sobieski, managing director of Band of But if record revenue is something to cheert about, Wall Street hasn't been greatly impressed. Hercules saw barelu a blip in its stock pric from its earningsannouncement Feb. 7. And its stocl was trading near $12.25, squarel y in the middle of its 52-wee k range, at press time. "The problej is, it's like whack-a-mole," Henriquez says. "It doesn'tg matter how well we do. Our other brethren in the mid-market get whacke and we get painted with thisbroad brush.
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