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Where Does Venture Capital Come From?

A venture capital firm finds the capital funding that companies seek for expansion and development. Companies seeking capital can be existing companies with a financial requirement or start-up firms. VC firms invest in companies with a strong potential for development and income generation. They take a high risk with expectations of a high return on their investment.

Where Does Venture Capital Come From?

The principle behind capital investment is that greater is the risk, greater is the possibility of high rates of return. Capital is not available through normal financing channels such as banks and other financial institutions. It is equity in cash form available to companies with innovative and powerful ideas and technology without sufficient capital to launch their initiatives. Most often, capital investment is made by firms in return for stock ownership in the company.

While the advantages of raising capital through VC firms are many, one major disadvantage is the high cost or repayment and relinquishing part of ownership rights. This method of raising capital is more popular among companies that are launched based on unique ideas rather than on physical stock. Innovation and emerging technology, therefore, have immense potential which attracts VC firms and private investors.

Venture capital funds are also created in a joint manner by groups of individuals with the same basic idea of obtaining huge returns on high-risk investments. There are various advantages as well as disadvantages for companies seeking capital through venture firms.

What is a Venture Capital Firm?

Apart from funding, a VC firm may provide a variety of value-added services to companies they invest in.

Companies are provided with strategic mentoring services such as financial and operational advice. Nominee directors are appointed by these firms in the company's board and are usually involved deeply in the day to day strategic development and direction of the company.

VC firms help a company identify strategic acquisition and network extension opportunities both locally and globally. They also facilitate acquisition after identifying lucrative partners. These firms help companies with trade sale as well as prepare them for IPO or Initial Public Offering.

A Few Negatives of Venture Capital

While these services provide great benefits especially for new or inexperienced start-up companies, there are certain disadvantages too. Most of the VC firms seek to recover their investments from companies in a maximum of five years. If your business is likely to take more time to liquidate, then it is in the interest of your business to seek other finance options.

Being highly sophisticated, these firms usually strike a hard bargain. Another disadvantage is that most of the VC firms have their eyesight set on the eventual acquisition of the company they invest in. There are possibilities of the VC firms interfering in strategic company operations, directions, and decisions. If they find the management not effective enough to drive enough business, they tend to take control of operations.

In spite of such disadvantages, venture capital firms provide funding which is extremely necessary and indispensable for many companies who are looking to establish or revamp their structure to generate more profits. This is the reason why a lot of businesses approach VC firms for support and financial help.

Bankruptcy Filing: Is It The Right Answer For You?

Many things can happen in life that can cause personal financial strain. It can be brought on by poor decisions, loss of income or even, a death in the family. No matter what has put you in the financial situation that has brought you looking for bankruptcy information, this information will help.

Bankruptcy is a very complicated, and scary process. Usually anyone who applies for it, is at the end of ones rope. To help you feel more in control of things, be sure to educate yourself about the entire process before making your decision. Learn the requirements you have to meet before applying. Learn also from professionals - bankruptcy lawyer West Jordan. Learn about what the process will be when you do apply. Finally, learn how your future will be affected by it after you file.

Take some time each day to stop thinking about your bankruptcy. It can seem like a thought you cannot get out of your head, but it is important to step away from the situation before you become too upset. Not only that, but removing it from your thoughts allows you to bring a fresher, more optimistic perspective to the table when you take up the subject again.

In any personal bankruptcy filing, it is essential to make certain to list all elements of your financial life in your petition and other paperwork. Failing to include all income sources or omitting individual debts and accounts can lead to substantial problems down the road that can limit the dischargeability of some of your most substantial obligations.

If you have had to file for bankruptcy, you should assess the reasons why to make sure that you do not end up in that situation again. For example, if it was for paying too many bills late, you can set up automatic payments so you will not have that problem in the future.

Don't think of bankruptcy as the ruination of your financial future. Once your bankruptcy has been discharged, you can begin to work on re-building your credit right away. By continuing to make timely monthly payments and not applying for new credit, you can significantly raise your credit score within 6 months. And, if you maintain good credit for that amount of time, you may find it possible to get approval for loans to make large purchases, such as a home or car.

An important tip regarding personal bankruptcy is, gaining an understanding of what sorts of debts can, and cannot be included in a discharge. By realizing that some obligations are not considered dischargeable under the bankruptcy code, it is possible to make a wiser, more informed choice when it comes to making the decision to file a petition.

Honesty may never have been as important as it will be when going through personal bankruptcy. Hiding income or assets may result in a dismissal from the court. It could also mean that you will be barred from ever having the opportunity to file for bankruptcy any time in the future.

Use this information to help you to get through this trying time in your life. Being aware of how it works and how it will affect your future, can go a long way in making the decision you are facing. Use these tips to help with one of the most difficult decisions of your life.