Also called the cost of carry or, simply, carry, the difference between the cost of financing the purchase of an asset and the asset’s cash yield. Positive carry means that the yield earned is greater than the financing cost; negative carry means that the financing cost exceeds the yield earned.³

(NAV) Calculated by adding the value of all of the investments in the fund and dividing by the number of shares of the fund that are outstanding. NAV calculations are required for all mutual funds (or open-end funds) and closed-end funds. The price per share of a closed-end fund will trade at either a premium or a discount to the NAV of that fund, based on market demand. Closed-end funds generally trade at a discount to NAV.³

An automated information network which provides brokers and dealers with price quotations on securities traded over the counter.³

A mandatory association of brokers and dealers in the over- the-counter securities business. Created by the Maloney Act of 1938, an amendment to the Securities Act of 1934.³

(NACO) Canada’s analogue of the American Angel Capital Association (ACA), and a close affiliate and partner of the ACA.  See http://www.nacocanada.com for more information. ¹

A mutual fund, or an open-end fund, sells as many shares as investor demand requires. As money  flows in, the fund grows. If money flows out of the fund, the number of the fund’s outstanding shares drops. Open- end funds are sometimes closed to new investors, but existing investors can still continue to invest money in the fund.  In order to sell shares, an investor usually sells the shares back to the fund. If an investor wishes to buy additional   shares in a mutual fund, the investor must buy newly issued shares directly from the fund. (See also: Closed-end Funds.)³

Minority Enterprise Small Business Investment Companies or MESBICs are government-chartered venture firms that can invest only in companies that are at least 51 percent owned by members of a minority group.⁵

• A blend of debt and equity financing, requiring no collateral and does not necessarily involve giving up interest in the company. This capital is typically used to fund growth or to enable management to buy out company owners for succession purposes. The interest rate is high, ranging from 20-30% and lenders can convert their stake to equity or ownership in the event of default.²
• Refers to the stage of venture financing for a company immediately prior to its IPO. Investors entering in this round have lower risk of loss than those investors who have invested in an earlier round. Mezzanine-level financing can take the structure of preferred stock, convertible bonds, or subordinated debt.³
• Mezzanine Financing is a late-stage venture capital, usually the final round of financing prior to an IPO. Mezzanine Financing is for a company expecting to go public usually within 6 to 12 months, usually so structured to be repaid from proceeds of a public offerings, or to establish floor price for public offer.⁵

Mezzanine debts are debts that incorporates equity-based options, such as warrants, with a lower-priority debt. Mezzanine debt is actually closer to equity than debt, in that the debt is usually only of importance in the event of bankruptcy. Mezzanine debt is often used to finance acquisitions and buyouts, where it can be used to prioritize new owners ahead of existing owners in the event that a bankruptcy occurs.⁵

A combination of business entities under which efficiency improvements are expected to be achieved from potential synergies by eliminating duplicate factors of production such as plant, equipment  and labor and by the more efficient use of capital driving increases in revenues and profits in the resulting company.⁶