High-tech firms are finding the loan market extremely friendly these days, according to a recent survey by Coopers & Lybrand.
The firm's "Trendsetter Barometer" surveyed 440 chief executives of companies with $1 million to $50 million of revenues. Half the respondents lead high-tech firms.
Of the companies that had completed new loans, 34% were high-tech firms. Of those that had increased their credit lines, 32% were high-tech, up from 28% the previous quarter.
"Banks are finally starting to understand how to deal with the intellectual property of these companies," said Martin Janowiecki, a tax partner at Coopers & Lybrand.
In the past, high-tech businesses-life science, computer hardware, and software development companies-typically had to rely on venture capital or the equity markets for new capital.
But due to a growing concern among investors that equity markets may be overvalued, high-tech firms are looking elsewhere for funding.
"A secondary offering is an expensive way to go get additional capital, since there is the capacity" in the bank loan market, he added.