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

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Observers say the firm'es aggressive strategy to lendto high-risk venture capital-backed companies and its soli d relationships with venture investors has helped buil d the value of its loan portfolil beyond $530 million in just four years, whils traditional financiers tighten lending standards and strugglde to grow revenue. And Herculews says the credit crunch might just be playing tothe firm'z favor. Hercules posted recordx revenue in the fourth quarter of 2007of $15.8 an 82 percent increasee over 2006. The company grew its net incomd by 424 percentto $20.t million. For the the company grew net income in 2007 by 273 percenytto $42.4 million. And it loaned out $367 million.
Herculesw credits several factors forits performance: recored venture capital raised and invested in 2007, a lengthening of venture-backedc companies time to exits and the volatile capital marketw that make public offerings more "Those are the interesting phenomena that reallgy bode well for our says Hercules CEO Manuel Henriquez. The firm says it's builyt an aggressive team that has helperd it win more deals likeits $15 million loan announcec Jan.
29 to 30-million-user social networok hi5 Hercules has positioned itself to bea front-runner in high qualityt deals by the relationshipsx its forged with venturre capitalists, says Dave Feinlib, a partner at Mohr Davidosw Ventures and a board memberf of hi5. Since Dec. 2, the firm has announce d $94 million in financing to venture-backed "They're looking for a sort of blue chip VC firm to have made a reasonablee investment intothe company," Feinlib "We've certainly done tons and tons of due diligence in the companie that we invest in and they're leveraging that.
" Hercules is set up as a businesx development company, which requires it to distributew 90 percent of its taxable income as dividends but exempts the companuy from paying corporate income tax. That helpsw the firm compete onloan rates, Henrique z says. Competition among venture debt which include commercial banks such as SiliconValley Bank, and Squares 1 Bank, has heightened over the last severalp years as venture capital money has continueed to flow here. "Venture debt providers have becomse more aggressive lately and are providing bettef termson debt," says Ian Patrickj Sobieski, managing director of Band of Angels.
But if recorx revenue is something tocheer about, Wall Stree hasn't been greatly Hercules saw barely a blip in its stock pricwe from its earnings announcemenft Feb. 7. And its stock was trading near squarely in the middle ofits 52-week at press time. "The problem is, it's like Henriquez says. "It doesn't matteer how well we do. Our other brethren in the mid-market get whackef and we get painted with thisbroacd brush.
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