In what it calls a "first-of-its-kind" move, Dell recently launched a major initiative, which includes a credit fund for small businesses. The Dell Innovators Credit Fund is at the heart of this $100 million initiative and is geared towards helping those small businesses that have recently received venture or angel funds.
The fund was the brainchild of Ingrid Vanderveldt, a serial entrepreneur and Dell’s first entrepreneur-in-residence. Vanderveldt says her impetus came from noticing that many "entrepreneurs, even when funded, still weren’t getting the credit they needed."
Amid the buzz surrounding the fund's announcement, we wanted to take a closer look at how it will actually work.
1. The Innovators Credit Fund is not available to all entrepreneurs -- there are several qualifiers. First, you must have, within 90 days prior to applying, received venture or angel funding from a pre-selected group of VCs or angel investors. (Dell is adding new funders to that list.) Once you qualify, you can borrow up to 10 percent of your funded amount (up to a $150,000 limit) from Dell Financial Services, offered at what Dell calls "accelerated, limited credit terms."
2. Are you wondering why a business that just received an injection of investment capital would need to borrow money? The idea, according to Steve Felice, Dell’s president and chief commercial officer, is to offer entrepreneurs "access to technology to help fuel growth, while helping [them] preserve precious equity capital for other business needs." In other words, use your funds for revenue-generating activities, and not tech solutions.
3. Felice says one key to growth for many entrepreneurs is international expansion. He believes "technology enables small businesses to get access to more markets, more countries, and more supply chains." Easy access to technology has led to a global entrepreneurial awakening. Felice notes, "The world has woken up to the great benefits of bringing new ideas forward." He advises American entrepreneurs to realize that "the world not only [provides] customers, but can offer partners as well." And, of course, new technologies like accessing the cloud and virtualization services makes it easy to collaborate across the globe.
4. If you're a self-funded business, this initiative has some offerings for you as well. Vanderveldt plans to expand the Entrepreneur-in-Residence community which, over the next few months, will be adding new features, including instructional videos, e-learning, and advice from experts. Her goal is to create a "one-stop shop" for Dell’s 10 million small and midsize businesses.
Editor's note: The author's company, GrowBiz Media, produces a newsletter for the Dell Women’s Entrepreneur Network.