Venture Capital has become a booming business in the past few years. VC investing increased by about 31 percent in 2012. This might seem counter-intuitive, considering the skittish interest that investors have in the stock market. The answer might be that ordinary stock is unappealing, because established businesses are undergoing stagnation or downsizing. Investors might be hoping that emerging industries will fuel their desire for profit and growing assets.
There is plenty of money to be had, and many wealthy people are just holding onto their funds until they can find something better than slow bonds. If people think an asset is ready to grow, they are willing to take inordinate risks in rather shaky markets. Venture Capital is up because other investments seem less appealing.
This means opportunity, if you are a firm that specializes in venture capital fund raising. There are plenty of growing businesses that need cash to fuel their advancement, and plenty of of people with real cash that want the inside deal. A firm that can persuade both ends of business can end up with a lot of honest work.
A third party that offers fundraising as a service must know how to advertise an investment opportunity and how to hold a conference. They must make it seem like real information and not just a sales pitch. People are protective about their money, and do not want to feel like they are simply being sweet talked. Real facts and figures are key, as well as demonstrations of the end product.
For a firm that can show a successful track record, they will find ready customers both in start up companies and in folks wanting a slice of the action. Someone who can work both sides will garner good commissions and whatever other compensation becomes due. It is a rewarding career that serves a necessary purpose for emerging technologies and the entrepreneurs who are trying to put them on the market.
New companies can themselves seek venture capital, which might be the first step before a company can even get started. Closed stock that is sold to venture capitalists is often called seed funding. It is the money that goes into a business to get it started. Since it is not already operational, seed funding is considered more risky than investing in something that is already running and vigorously growing.
Interested to advanced venture capital topics? Read more from David Hand Crescent Point Singapore or visit Crescent Point Venture Capital news site, the leading emerging markets investment management and financial advisory firm primarily targeting in the Asia-Pacific and Middle East regions.
Howard Hartenbaum from August Capital discusses different types of funding sources, different types of investors and how to approach them, what VCs look for in companies, and his experiences from being an IT investor and entrepreneur.