Pursuant to a congressional request, GAO studied venture capital financings of Small Business Administration (SBA) small business investment companies (SBIC) and minority enterprise small business investment companies (MESBIC), focusing on the: (1) locations of the assisted firms; (2) types of financing provided; (3) assisted firms' industrial categories; and (4) accuracy and completeness of the SBA database regarding SBIC and MESBIC.

GAO found that, in 1987: (1) there were 307 licensed SBIC and 128 licensed MESBIC; (2) SBIC concentrated over half of their venture capital financings in five states and MESBIC concentrated nearly 80 percent of their venture capital financing activity in five states; (3) SBIC financings were secured with equity, debt, or a combination, while MESBIC typically secured their financings with debt instruments; (4) SBIC tended to finance a more diverse range of industries than MESBIC; (5) SBIC and MESBIC concentrated most of their financings in first-time ventures; (6) SBIC predominantly funded firms located outside their home states, while MESBIC funded a higher concentration of businesses within their home states; and (7) the SBA database contained reliable and accurate data, although it did not contain some reports which firms failed to file before the cutoff date for data entry.