文档介绍：Investment Banking:
Venture Capital
What is venture capital ?
Venture capital is also called private equity, equity investing or equity capital
A group of investors investing cash in a non-listed business by buying a portion of the equity (or ownership) of the business.
The terms venture capital and private equity relate to the stage and type of investment.
Venture capital - early stage panies
Private equity - later stage non-panies.
‘Stage’ refers to level pany development.
Venture capital is high risk (no assets secure the investment) and high reward (growth of business leads to pany value)
Venture capital is active, not passive investing.
Who receives venture capital funding ?
Companies or individuals seek venture capital money in order to grow. They may be expanding into new products, new markets, or acquire another business.
Usually they already have high levels of debt and can obtain no more. Or they have no assets (often only an idea on paper) and a bank will not lend to them.
They have a high-growth idea, technology, product or market opportunity.
Who ?
- Business people
- Scientists
- Technologists and engineers
- College Students
Stages and types of venture capital and private equity
Business Stage
VC or PE
Seed
Start-up
Expansion
Later Stage Expansion
LBO, MBO, MBI
Concept – business plan
Working prototype product or technology
pany – a few years of sales
Larger pany – acquisitions, mergers - into new products or markets
Mature businesses, corporate asset carve-outs (divestments)
Venture Capital
Stage
Early Stage
(Leveraged Buy Out, Management Buy Out and Management Buy In)
Some sales or a major contract signed
Venture Capital
Venture Capital
Venture Capital or Private Equity
Private Equity
Private Equity
How does a VC firm make money ?
pany grows from the initial investment value and is ‘worth’ more on exit. The equity bought, say at $5 per share is now worth $20 per share.
A VC firm will build a portfolio panies acro