While many venture capitalists may be swinging for the next home runs in software and biotech, not all have such highfalutin aspirations. If you've got a basic business and you meet certain criteria for location, income, and personal background, you might qualify for funding from a Specialized Small Business Investment Company (SBIC).

Specialized, or 301(d), SBICs operate under unique charters designed to assist disadvantaged business owners. In exchange for financing those applicants, the SBICs get to borrow as much as four times their private capital from the Small Business Administration. They also can obtain favor-able interest rates, paying three points below market.

To qualify for a 301(d) loan, an applicant must fit a characteristic profile. Five factors -- low income, limited education, unfavorable location, physical or other handicap, and "inability to compete effectively in the marketplace because of . . . past restrictive practices" -- are considered in determining eligibility. Vietnam veterans are also given special consideration.

There are now 132 specially licensed companies in the United States, located in 25 states (but with powers to invest elsewhere). Most concentrate on 4-to 10-year fixed-rate loans, but some do equity deals or debt with equity features. In 1990 Specialized SBICs made 1,033 investments, totaling $99.3 million.

What kinds of investments are typical? They run the gamut. Medallion Funding, a New York City firm, for example, finances lots of taxicab owners but recently made a $125,000 6-year loan to a first-time entrepreneur opening a Laundromat in West Harlem. "We do deals that most banks would turn away," says Alvin Murstein, Medallion's chairman.

Two directories that list Specialized SBICs around the country are Directory of Operating Small Business Investment Companies (free), Investment Division, Small Business Administration, Washington, DC 20416; and Membership Directory ($5), National Association of Investment Companies, 1111 14th St. NW, Suite 700, Washington, DC 20005.

-- Bruce G. Posner