What is a venture capitalist?
Venture capitalists are individuals or companies who provide investment capital and management expertise to new businesses. In return, they will ask for an equity position in the company, usually in proportion to their risk and the amount of their investment. They have a stake in your company because their future returns are tied to its performance.
People thinking of opening a business may view the venture capitalist (VC) as a single individual who is prepared to invest money in a fledgling company, or one that may be on the verge of success. Such a person “ventures” or puts up such money in the hopes of getting a good return on his/her investment. While a few private individuals are wealthy enough to singly provide money to float a company, most venture capitalists work with a group of other investors to invest in a company that has a promising chance of returning them more income within five to ten years of their initial investment. When a venture capitalist is part of an investment group, he or she is probably not just investing in one business. Instead, the group raises funds to invest in a number of businesses. Even with the best business analysis, not all businesses will succeed. By diversifying, a venture capitalist group has a better chance of turning a profit. When a company is successful, these investors can make approx
A venture capitalist is a business person looking to invest in a fairly young company, in hopes that the company will grow and reap high financial returns, earning back five or ten times back the original investment (and sometimes even more than that). Venture capitalists are often willing to take more considerable risks in a business than a bank would, so it is a very viable source of money for businesses. A venture capitalist, also commonly known as a VC, may not be the one actually bringing the money to the table for a new investment, but often act on the behalf of a wealthy investor who doesn’t want to deal with finding the diamond in the rough. Venture capitalists generally only invest in a small percentage of the businesses they consider. They look for quick returns, ideally in a few years, but as long as ten years. Average is anywhere between three and seven years.
A venture capitalist is an individual who has the money or capital that you as the business owner needs to help get your business going. Venture Capitalists are looking for businesses where they can invest and then see a return on their investment. A venture capitalist does not give money to a business owner without expecting a worthwhile return. So how can you convince a venture capitalist that your company is worth investing in? The concept seems simple. You need to develop a business plan. In this business plan you need to clearly explain your plan to be successful and make money. Detail is important, unless the venture capitalist can follow your logic and agrees with your philosophies, he is going to take his money elsewhere. Also, you need to make it abundantly clear that now only is your business going to be successful, but that your investors will be handsomely rewarded well above their initial capital investment. Be confident. Show your venture capitalists that you are the kind
a venture capitalist is someone who invests their money in other people’s business ventures and usually these are ventures that are somewhat risky and usually are ones in which conventional financing has been turned down. If the venture is successful then it can be highly profitable to the investor.
