VC 1

• An undertaking which involve risk

Answer explanation

Venture

• A dare to do or say something.

Answer explanation

Venture

• An amount invested by the person/s to carry out the newly

established business.

Answer explanation

Capital

• An amount invested by the person/s to carry out the newly

established business.

Answer explanation

Capital

means funds made available for startup firms

and small businesses with exceptional growth potential.

Answer explanation

Venture capital

is the financial support to young, rapidly growing

companies/ individuals that have potential to develop into

significant economic contributors by the businessmen/ group to

create a product or service which has a unique idea.

Answer explanation

Venture capital

Features of Venture Capital

Answer explanation

• High risk

• Participation in management

• Provided at earlier stage

• Finance to Smaller and Less Mature companies

• Finance new and rapidly growing companies

• Lack of liquidity

• Long time horizon

Pros of Venture Capital

Answer explanation

• provide large sum of equity

finance.

• Venture

Capitalist

are

rewarded by business success

& the capital gain.

• Able to bring wealth and

expertise to your company

• The Venture Capitalist also

has

a

wide

network of

contacts.

• Providing additional funds.

Cons of Venture Capital

Answer explanation

• Lengthy and complex process

(needs

detailed

business

plan,

financial

projections

etc.)

• In the deal negotiation stage,

you will have to pay for legal

and accounting fees

• Investors

become

part

owners of your business -

founder loss of autonomy or

control

• This scheme meets businesses having large up-front capital

requirements which cannot be financed by cheaper alternatives such

as debt

Answer explanation

Venture Capital Funding