Posts
The virtues of venture capital are often forgotten or ignored by most small and medium entrepreneurs. However, this remains a sound source of capital.
In France now more than 5000 companies use investments of private equity to fund their operations. There are many others that still refuse to use them for either fear of losing the control of their company or because they do not fully understand how it works.
What is Private Equity? Is it the same thing as venture capital?
Yes, it does. Private equity can be invested mostly in four ways. One of them is Venture Capital. In this line, private equity can be invested on businesses that are starting, those that are mature, or those that are in trouble. Venture capital, growth capital, leveraged buyouts help companies during their cycle of life.
Is there an advantage for a business owner to use capital investments?
During the life of a business, funding is needed to make the business flourish. Moving it forward at the beginning and developing it when it is mature. In any of those cases, private equity investments are a great relief to the finances of small business. The business owner does not need to ask for a credit and it can potentially attract more financing in the future.
Is a private equity investor seen as another partner in the company?
Capital investors usually have a plan of leaving the company after a certain number of years. However this date is not determined before hand. Capital investors want to provide funding to the business and focus more on the long term rather than the short.
Capital investors do not specify when they will leave the partnership or the company, but they stay no less than three years but no more than seven. They receive the value of their share just like any other shareholder but increase the value when they sell it. That is the ultimate goal of a venture capitalist for instance, selling his or her share and make a profit.
In France now more than 5000 companies use investments of private equity to fund their operations. There are many others that still refuse to use them for either fear of losing the control of their company or because they do not fully understand how it works.
What is Private Equity? Is it the same thing as venture capital?
Yes, it does. Private equity can be invested mostly in four ways. One of them is Venture Capital. In this line, private equity can be invested on businesses that are starting, those that are mature, or those that are in trouble. Venture capital, growth capital, leveraged buyouts help companies during their cycle of life.
Is there an advantage for a business owner to use capital investments?
During the life of a business, funding is needed to make the business flourish. Moving it forward at the beginning and developing it when it is mature. In any of those cases, private equity investments are a great relief to the finances of small business. The business owner does not need to ask for a credit and it can potentially attract more financing in the future.
Is a private equity investor seen as another partner in the company?
Capital investors usually have a plan of leaving the company after a certain number of years. However this date is not determined before hand. Capital investors want to provide funding to the business and focus more on the long term rather than the short.
Capital investors do not specify when they will leave the partnership or the company, but they stay no less than three years but no more than seven. They receive the value of their share just like any other shareholder but increase the value when they sell it. That is the ultimate goal of a venture capitalist for instance, selling his or her share and make a profit.
About the Author:
Wade Henderson - recognized Professional - 15 yrs in the Business Finance Field - strong reputation for getting the deal done. IMMFinancial.com IMM Project Finance IMM Leasing Grab a totally unique version of this article from the Uber Article Directory
No comments:
Post a Comment