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December 30, 2008
The Journal Record
By Brian Brus
OKLAHOMA CITY - A new administration under President-elect Barack Obama could loosen up financing for businesses owned by Oklahoma's Native American Indians and other minorities seeking growth capital, Phil Busey Sr. said
Potential venture capitalists now face a few big deterents when it comes to putting up a stake in tribally based companies, not the least of which is the attractive minority-owned status itself, said the chief executive of the Busey Group of Companies and senior legal partner at the Busey Law firm.
"Right now there are very little funds available, so any federal law changes to turn that around throught the SBA (Small Business Administration) could help secure more financing and ultimately, make venture capital easier to access," he said. "We'll have to see what happens under the new Obama administration. I know they've made a commitment to beef up the SBA and provide more opportunities that haven't been there under the current administration."
Busey is a member of the Cherokee Nation and Delaware Tribe. Busey Law focuses on representing large corporations, family businesses, tribal governments and emerging small minority businesses. He said he would like to see Native American investment funds created that would like to se more Native American investment funds created that would encourage multiple tribe interaction for benefits of all.
"A lot of tribes have been reluctant to do that because they might say, for example, "Our tribe raised its own money; we don't want to put it in another tribe," he said. "But they have a lot of revenues already coming in from gaming revenues, so I think the future source of venture capital for tribal businesses could easily be the tribes themselves."
Bridging the finance gap for tribal businesses and related economic development was the main focus behind the founding of Native American Capital, LLC, a merchant/investment bank and private equity and venture capital fund management company in Silver Springs, MD. The company has adapted the traditional private-equity investment model "to the unique challenges and opportunities of Indian Country," NAC says on its corporate Internet site.
Those challenges include underdeveloped infrastructure, unfamiliarity with Native American law, and high rates of poverty in the some tribal communities.
"Unemployment and poverty are widespread in Indian Country," Managing Director Walter Hillabrant has said. Hillabrant is an enrolled member of the Citizen Potawatomi Nation of Oklahoma. "Venture capital can provide the critical link to economic development and job creation."
Since its founding, NAC has sought out business development opportunities of tribal interest, including basic infrastructure industries in information technology, communications, housing technologies, alternative-energy technologies and health care.
Busey said tribally generated capital, similar to NAC's business model, would also help sidestep the problem that arises when an outside investor wants an active position in a federally recognized minority business with 8(a) status under the SBA.