Community Development Venture Capital Alliance

Natural Capital Investment Fund, Inc.
P.O. Box 1889 Shepherdstown, WV 25443
Telephone: (304) 876-2815
Fax: (304) 870-2208
Website: www.freshwaterinstitute.org
Email: ncif@freshwaterinstitute.org

Key Personnel: Marten R. Jenkins, Jr., Executive Director

Established: 2000

Total Committed Capital: $400,000 (with the goal of $5 million by 2005)

Amount Invested: $108,500

Geographic Focus: West Virginia

Background
The Natural Capital Investment Fund, Inc. (NCIF), an affiliate of The Conservation Fund, is a revolving loan and equity investment fund. The fund's goal is to assist high-potential new and expanding businesses involved in natural resource-based activities that are unable to obtain sufficient financing from conventional sources. Businesses must demonstrate a commitment to sustainable economic development principles, have the potential to diversify rural economies, and create or retain family wage jobs. By providing a successful mix of debt and equity financing to these businesses, NCIF hopes to attract commercial capital and strengthen natural resource-based industries in West Virginia. NCIF differs from the traditional venture capital model in that it will seek opportunities to wed equity with debt in order to assure a return that is not dependent on finding the right exit opportunity in the years to come. The equity position established by the NCIF will be smaller than those frequently taken by venture capitalists, making the possibility of repurchase by the business more viable. This reduces the need for initial public offering or sale of the company. It allows equity investments in ventures that are not likely to go public and avoids the risk that an acquirer would move the company out of the targeted community.

Social Mission
The Fund aims to help entrepreneurs in rural West Virginia create new sustainable economies that are linked to protecting and restoring West Virginia's natural resources.

Investment Information
The Fund made two investments in 2001. NCIF serves all of West Virginia with special emphasis on the following counties: Barbour, Boone, Braxton, Calhoun, Clay, Fayette, Gilmer, Lewis, Lincoln, Logan, McDowell, Mason, Mingo, Nicholas, Pocahontas, Raleigh, Randolph, Ritchie, Roane, Summers, Taylor, Upshur, Webster, Wetzel, Wirt, Wyoming. NCIF invests in natural resource-based enterprises. Eligible activities include, but are not limited to, alternative agricultural activities such as aquaculture, value-added wood and agricultural products, and manufacturing from industrial by-products or recycled materials in West Virginia. The Fund will not invest in any coal or basic agriculture related businesses. NCIF's investments typically range from $50,000 to $250,000, with the stipulation that the investment cannot exceed 75% of the project's cost. The Fund will invest in small businesses at any stage of development. It has co-invested with other CDVC funds and community development entities in the past and would like to increase its co-investments in the future.