12-11-2012, 11:41 AM
VENTURE CAPITAL
PPT on Venture Capital.ppt (Size: 993 KB / Downloads: 46)
Introduction
Venture Capital is an alternative form of equity financing made available to new ventures and technically qualified entrepreneurs with inadequate funds, high risk and good growth prospects.
Venture capital is a method of business funding for companies who are looking to grow or expand at beyond normal rates of business growth.
Features of Venture Capital
Equity-Debt Financing
High Risk
Stages of Investment
New Technology
Professional Entrepreneurs
Long-Term Investment
Importance of Exit Route
Creative Capital
Facilities Growth
Global Concept
Encouraged New Ideas
Assistance and Services Provided by Venture Capitalists
Providing advice on management and board decisions.
Introducing entrepreneurs to suppliers and distributors.
Linking relationship between entrepreneurs and lenders.
Introducing entrepreneurs to management consultants.
Developing relationship with securities firms and brokers.
Facilitating expansion financing or IPO underwriting.
Monitoring all investors’ interests through involvement.
Providing technical assistance on products and innovations.
Acting as guarantors on loans or leases.
Finding key resources, locations, or facilities.
Maintaining contacts with entrepreneurs.
Objectives of Venture Capital Funds in India
It injects long term equity finance which provides a solid capital base for future growth.
The venture capitalist is a business partner, sharing both the risks and rewards.
The venture capitalist is able to provide practical advice and assistance to the company based on past experience with other companies which were in similar situations.
The venture capitalist also has a network of contacts in many areas that can add value to the company, such as in recruiting key personnel, providing contacts in international markets, introduction to strategic partners, and if needed co-investment with other venture capital firms when assitional rounds of financing are required.
Scope of Venture Capital
From the venture capitalists’ point of view, the can involve from the newly start-up enterprises to the expansion of established enterprises. Similarly, the role of venture capital from the enterpriser’s point of view are that these are available to offer services from seed capital onwards to meet the enterprise’s requirements for expansion and diversion as also for restructuring the enterprise.