Rand Capital is a Business Development Company (BDC) that provides debt and equity financing to small, privately held companies in the lower middle market. Rand targets businesses with revenues above $10M and EBITDA above $1.5M that need growth capital, expansion funding, or financing for ownership transitions such as family business successions or small leveraged buyouts. Rand's core product is subordinated debt — typically term loans at 12%-14% interest rates — often paired with a small equity co-investment via warrants or a direct equity stake. The debt delivers current income, while the equity gives Rand upside if the portfolio company grows or is sold. Rand typically invests $2M-$4M per company as a minority investor. As of Q3 2025, Rand held investments in 19 companies at a fair value of roughly $44M, with 83% in debt and 17% in equity. Rand earns income primarily through interest on subordinated debt, origination and structuring fees, and occasional capital gains on exits. A growing share of income comes from PIK (payment-in-kind) interest, where interest accrues to the loan balance rather than being paid in cash. Rand is structured as a Regulated Investment Company and must distribute at least 90% of taxable income to shareholders, driving a regular quarterly dividend supplemented by special dividends following significant exits. Rand is externally managed by Rand Capital Management, which earns a base management fee plus incentive fees tied to income and capital gains. Rand's growth strategy centers on recycling capital from loan repayments into new debt investments and co-investing alongside affiliates to access larger deal pipelines.