Venture investment is an investment in the opening business. Moreover, the direction of this business is usually an innovative and high-tech project. However, it would be wrong to say that this type of investment covers only the start-ups associated with high technologies would be incorrectly. Venture investment may be connected with such directions as, say, restaurant business or construction. Just today, venture investment in high technologies is the most popular. As the most famous and successful examples of such projects, companies such as Apple, Intel, Yahoo! can be boring and many others.
To date, this is a relatively young type of investment. He originated in the 50s - 60s. 20th century to this day continues to rapidly gain momentum. Today, venture capital investment is extrabudgetary investment of various innovative ideas.
Simply put, venture investment is the provision of a loan that starts its start to companies that have serious development potential and whose activities are often innovative. The features of such companies on the one hand are quite serious risk for the investor (Venture translates as a "risky undertaking"), and on the other hand, due to its novelty, are the success of very promising enterprises capable of several times / tens of times / hundred times to increase the initial investor investment investment. Investors have the opportunity to invest financial resources for medium or longer period, but it should always be remembered that there is no possibility to withdraw the investment, until it is completed, a company development cycle in the investment contract.
What is a venture fund?
The Venture Fund is an organization that accumulates financial resources in its account invested in the development of the most promising innovative business projects on their start-up, in order to profit. Participants in such funds can be banks, large corporations, insurance companies or individuals. Such funds have a certain life cycle and, as a rule, are created for a period of 5-7 years. Some Venture Organizations may have a narrow orientation, that is, to invest funds, for example, only in medicine or heavy industry. Other organizations, on the contrary, can wear a wider investment sphere, investing financial resources, and in medicine, and in the heavy industry, and in connection with ecology, etc. The choice of potential objects for investment will be based on the following criteria.
The head of the Foundation is a management company, which is an intermediary between investors and entrepreneurs and applying to part of the profits received by investors.
Value investment specificity
Stage of venture investment
Stages of development of a venture investment
Sowing Stage ( seedStage. ). At this stage, investment is carried out in the company at that stage of development, when it has an idea of \u200b\u200bbusiness, but the final product has not yet been created. At this stage of development, work is underway to create a prototype.
Start-AP ( start. — upstage. ). By this time, the enterprise has already created a product in it while still a pilot version and began the process of testing it.
Early Stage (Earlystage). The product is fully prepared to be bred on the market.
Expansion Stage (ExpansionStage). Active sales of the created product.
Late stage of development ( laterstage.). Company development to a large public organization.
Specificity of Russian venture investment
If we take a venture investment in innovative projects as an example, then, unfortunately, it is necessary to state the fact that in Russian reality this type of investment is associated with many problems.
- The first of them is to protect intellectual property in our country.
- The second problem is associated with the insufficient knowledge and experience of managing venture capital funds.
- The third problem is to be rooted in the tax sphere that does not stimulate entrepreneurs to create venture funds.
Examples of venture funds
I hope that this article helped you better understand the question "What is venture investment?".
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Russia has many competitive advantages that stimulate investor interest, including foreign ones. The domestic economy is a capacious market for capital, has a great potential of internal demand, highly qualified personnel. In the aggregate, it creates excellent conditions and opportunities for venture investment.
Modern definitions of the concept of "venture investment" are ambiguous. Scientists have developed several options, and each of them is used in profile literature, among experts. Some believe that venture capital investment means financing activities in the field of technical, technological, scientific innovations, which are not yet implemented in practice. Others argue that the term is correctly interpreted as the commercial sale of innovation, resale the results obtained using the "risk" capital. But all experts are unanimously in the fact that venture capital investments are a system of mutually beneficial relations between venture capital funds, private individuals investing in innovative projects and developers. For this, a unique idea must necessarily have a large market potential. Such a format of investment means a high level of risk, which in the theory should be met by a high income indicator (from English Venture is translated as risk). The venture capitalist who has invested money is lossed on a par with the developer of an innovative project.
Council: Find a profitable partner for venture capital financing in the person of a private investor who will be interested in the implementation of profitable business ideas or venture capital funds, for example, Runa Capital, IMI.VC, RU-Net Ventures, Kite Ventures, etc.
The characteristic features of venture capital investment are the long-term return of investments (especially in the field of biotechnology, medicine) and the need for large investments at an early stage of project development. Bank loan for these purposes is difficult to obtain, as financial institutions refuse to give loans for intangible assets and cannot evaluate new business models that will not soon receive income. Therefore, the best option for financing innovative projects is cooperation with venture capital investors or funds. The latter will accumulate serious capital at their account, receiving income from successful projects, startups. They can finance the company even in the absence of collateral. Insurance companies, private investors, large corporations become their participants. On average, venture funds operate no more than seven years. Often they not only finance projects, but also contribute to their development, providing consulting support or occupy the place in the Board of Directors. As a rule, their participants do not seek to have the right to vote in management or very deeply delve into the daily problems of the company. After all, often venture capitalists invest in several high-profile enterprises (despite this, they have nothing to do with fraudulent projects built on the principle of financial pyramid), and they have no physical opportunity to delve into each trifle. Profit gets, as a rule, only a few years due to net income from investing, the growth of the value of shares.
Criteria for assigning firms to projects in need of venture investment:
Spheres where venture investors can work are very much, but most often they invest money in biotechnology, innovative ideas, construction, restaurant or. The result of successful investment of such a plan is Apple, Intel, Facebook, Alibaba, etc. It is fundamentally different from - the main goal of venture capital financing is not to solve problems of production activities by attracting a wide range of persons with professional knowledge, and investing risk capital in promising ideas, projects In order to obtain high income. Sometimes investors become co-founders of venture capital firms. If possible, they are trying to invest in several projects of a different profile in various fields, achieving a reduction in total risk.
Self-financing is the main source of initial capital for the majority of firms in new technologies. But venture funds reluctantly finance small enterprises (regardless of the quality of their work) due to the specifics of the investment criteria, the high cost of expertise, the complexity of the monitoring. The average yield of venture capital funds in the world is about 20%, which exceeds the average profitability of other organizations, in Russia - 30-35%. The cost of a share is rarely less than 1 million rubles. Venture investment is a very risky, but also a very profitable activity. A risky type of earnings (income from it will be significantly smaller) consider trade in binary options. ? So call the agreement between the two parties, allowing its owner to buy or sell a certain asset (stocks, bonds, goods) during a specific period of time at a prescribed price.
Council: According to the law, only legal entities can be in the venture capital. Therefore, in order to become his participant, you first need to register your company, acquire certificates, obtain complete information about the objectives and methods of the Foundation's activities.
For small firms and most private innovative projects, the only way out is to search for venture capital investors. They are also called business angels. They always have great personal capital and are ready to invest money back at an early stage of development. Do it individually or groups. Net income is expected usually no earlier than 5-10 years. After the end of the project, the share most often is sold in the market or company itself.
Council: Get a maximum of income from venture investment under any market conditions will help. Their main goal is not a risk limitation, but to ensure the profit in any direction of the motion of market prices. Investor need to choose a partner among such organizations very carefully, because their existence is not issued by the legislator, and the applied strategies have different efficiency, not always high. In any case, attentiveness and professional training of the investor are mandatory conditions of the transaction.
Most entrepreneurs who are planning work in a small business are interested in the answer to the question. There are quite a few options (opening of its production, enterprises for the provision of services), but ventureal investment unequivocally does not fit. After all, its scale is rather large - from 50 thousand dollars to several million.
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The underdevelopment of the business infrastructure of our country, the remnants of past years prevent the rapid formation of the new financial industry - venture capital investment. But now it is one of the basic sources of financing for many modern companies, small and medium enterprises.
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The peculiarity of venture investment is that they are usually intended to start, grow, the development of a company whose activities wears at least a small shade of originality, uniqueness, i.e., roughly speaking, with venture capital financing, the means are investing in the implementation of any The new idea, the performance of which has not yet been proven by the market. In this regard, venture capital investments suggest a fairly high risk of capital loss by an investor; At the same time, in the case of a favorable development of events, they allow to count on the impressive amount of profit. Most often, venture capital investments are involved in the aim of developing various innovative technologies, new market development methods, etc. Those. Venture investments are usually becoming relevant where there is a certain experiment, some risk share (associated with the possibility of unsuccessful implementation of the conceived idea). Accordingly, venture capital investments are usually long-term, because they are involved in "inventing", to create and promote one or another project, which subsequently (as its creators think) can fill out any new niche in the market and bring solid profit .
As a rule, a profit from venture investment Investor receives not in the form of periodic dividends, but in the form (unidance) sale of its share in business, which he financed at the stage of its origin.
The differences between venture investment from any other type of investment are as follows:
Although, in addition to the orientation, the successfully developing small enterprises with the potential of rapid growth, venture capital also inherent in a number of even additional features.
Here is a small list of major distinctive features:
Since, for the implementation of investments with profit, but it is necessary for venture enterprises, it is necessary that the new high-tech company enters the securities market for the sale of shares, the owner of the funds invested in the company is not interested in the dividends, but the level of increasing capital. Venture capitalists who have invested their funds in Venture Company, are peculiar to the desire to increase their capital at least 5-7 times for 7 years. Since the exit of a venture enterprise on the stock market can be carried out, at best, after 4 years from the date of investment, and, understanding this, the venture capitalist does not expect profit earlier than this period. Throughout this period, this capital is notable, and the amount of profit will become known only after the company's market is released, when their share package will be sold to the amount that significantly exceeds the size of the originally entered in the company's funds.
And this "excess" sometimes can be quite significant. For example, in Russia, one small scientific team, thanks to a very modest investment (several thousand American dollars), it was possible to create a drug "Timogen", which has powerful immunomodulatory properties, which has been manifested immediately in several countries. As a result, only one license to produce the drug was sold in the United States in the amount of several million dollars. A similar profitability of several thousand percent, not a single production project can give, and even common financial and bank fraud in Russia in Russia. Such an incredible profit growth can be caused only by venture business.
A characteristic feature of venture investment is that the investor's desire to acquire the company's control package is practically absent, which fundamentally distinguishes it from a partner or strategic investor. The investor assumes the financial risk, and other types of risks: Market, technical price and managerial, etc., reserves the management, which also focuses the controlling stake in the enterprise.
Considering the nature of the venture business, almost every such investment, regardless of the stages of the development of the new company, is a financial operation with great risk, the degree of which in conjunction with courage and patience, which can be justified only by the high profitability of an invened high-tech enterprise in the late stages of its development.
Taking into account the degree of risk, and the fact that in case of unsuccessful investment in the company, the investor will lose all invested funds, capital owners in order to reduce risk, are directly involved in the management of the company, entering the board of directors, as in investing business angels. For the same reason, venture capitalists often take personal participation in the selection of investment objects, and there are always several venture operations at the same time, therefore, they are ready to work with both new and acting, as well as those who are preparing for the sale of companies.
In order to reduce risk, a venture capitalist, as a rule, distributes its assets between several projects, although it is not excluded to maintain one project by several investors. For this, in the venture introduction of resources, step-by-step financing applies. Funds are allocated by small portions of "tranches", in the slang of venture businessmen, this means "through the dropper", i.e. Each subsequent financial infusion is possible only after a successful previous one.
Also, venture capital investors, investing there, where the bank (for considerations of caution or by the Charter) to invest is not solved, they are not just a package of ordinary or preferred shares. But also discuss the condition (acquiring privileged shares) on which they will be eligible when the critical moment is made to exchange them on simple, in order to gain control over the "clutter" company similarly and try, a fundamental change in the strategy to take it from bankruptcy. Such actions are quite justified, because Venture investors go to a huge risk, passing their funds into the share of other companies, counting on high profits, characteristic of the most successful companies in the field of high technologies, the price of whose shares, in 5-7 years increases several times.
A decisive role in the successful activity of the enterprise often belongs to the quality of management actions, and not a fundamental idea, which is the basis of the technological process and products. Therefore, a venture businessman, less attention pays the intricacies of a scientific idea, and prefers to thoroughly assess the potential opportunities for the capitalization of this idea and managerial abilities of the head and administrative link of the company.
A venture investor continues to work with a supreme company until it just firmly "will be on his feet," but will become a "tight piece" for potential buyers. Upon the occurrence of such a moment, the former owner of the invested funds, and now the owner of the share of the package of shares, considers his mission over and comes out of investment, released the funds frozen for several years and receiving well-deserved profits.
For the output of funds, the venture capitalist has two quite real options:
And, despite the fact that venture investment is inherently characterized by the risk, it is this excessive risk of investing an unknown company represents the most significant limiting factor for a potential investor, reflecting where to invest free capital with the greatest benefit. Purchase shares of oil business, to invest in a new company, developing tomorrow's technology, which is fraught with risk, or put funds to the bank, at least under low, however, a guaranteed percentage.
Although absolutely non-rated financial transactions, in principle, do not exist - life is replete with examples, when the collapse of oil companies and become the most reliable banks (here the Russians are memorable paints in 1998), and that risk, many seemed So big and more than obvious, in reality turned out to be clearly exaggerated. In addition, it turns out that one who dares to take a chance received a very weighty bonus for his risk.
Another very significant sign of venture investment is that venture financing always reacts very sensitively and takes into account its trends. Most often, investing in those sectors that are associated with the rapid and profitable possibility of selling highly technological high-tech products, which already uses attractive demand, or this demand is only formed, and threatens great profit.
For example, at the end of the last century, the massive hobby by reading CD devices began, and immediately in this industry became venture capitalists with a big hunt and at profitable facilities for companies to invest huge funds. And with the departure of this fashion, dried and stream of investment. The same phenomenon was observed when there was a cooking hobby of cell phones. It can be predicted in the near future to cease to be in high-tech services to ensure access to the Internet. Of course, after some time, the profitability of software for personal computers will lose a cost-effectiveness, which will also lead to a reduction in venture investment in this industry, since there is no venture investment, and in principle there can be no permanent sectors of the economy, forever attractive industries. Alternative will be only the desire of venture capitalists to multiply their funds.
Venture investments are an investment of funds that are equity, in promising rapidly developing enterprises. Such investments are one of the forms of implementation of technological innovations.
In theory, there is no one definition of the concept of "venture capital investment", however, they all proceed from its functional task: promoting the development of a particular business by infringing a certain number of financial assets, which are issued shares or part of the authorized capital.
Venture investments are directly related to investing in stock, and where there are shares, there is a certain proportion of risk.
Investing is made in the company, whose shares packages have not yet been quoted on the stock exchange. So-called "Venture capital" is invested in new developing companies for medium and long term. The opportunity to withdraw him at his request of the investor before the end of the campaign life cycle is absent.
Venture capital is provided mainly to companies with obvious potential for their development, and not to those companies that have already taken their place in the market and bring high profits.
Venture financing is aimed at maintaining new (unusual, and sometimes exotic) companies, which increases the likelihood of obtaining ultra-high profits, but on the other hand increases the risk.
Venture investment is a kind of loan for new companies, a long-term loan, not supported by guarantees, but with a higher than in the percentage banks.
With the development of the company there is an increase in its assets and liquidity, which is due to the emergence of demand for shares (non-mercy), as well as competitions that have arisen among those who want to acquire a very profitable business.
Although, in addition to the orientation for successfully developing small enterprises with rapid growth potential, venture capital also inherent in a number of additional features.
Here is a small list of major distinctive features.
Since, for the implementation of investments with profit, but it is necessary for venture enterprises, it is necessary that the new high-tech company enters the securities market for the sale of shares, the owner of the funds invested in the company is not interested in the dividends, but the level of increasing capital. Venture capitalists who have invested their funds in Venture Company, are peculiar to the desire to increase their capital at least 5-7 times for 7 years. Since the exit of a venture enterprise on the stock market can be carried out, at best, after 4 years from the date of investment, and, understanding this, the venture capitalist does not expect profit earlier than this period. Throughout this period, this capital is notable, and the amount of profit will become known only after the company's market is released, when their share package will be sold to the amount that significantly exceeds the size of the originally entered in the company's funds.
And this "excess" sometimes can be quite significant. For example, in Russia, one small scientific team, thanks to a very modest investment (several thousand American dollars), it was possible to create a drug "Timogen", which has powerful immunomodulatory properties, which has been manifested immediately in several countries. As a result, only one license to produce the drug was sold in the United States in the amount of several million dollars. A similar profitability of several thousand percent, not a single production project can give, and even common financial and bank fraud in Russia in Russia. Such an incredible profit growth can be caused only by venture business.
A characteristic feature of venture investment is that the investor's desire to acquire the company's control package is practically absent, which fundamentally distinguishes it from a partner or strategic investor. The investor assumes the financial risk, and other types of risks: Market, technical price and managerial, etc., reserves the management, which also focuses the controlling stake in the enterprise.
Considering the nature of the venture business, almost every such investment, regardless of the stages of the development of the new company, is a financial operation with great risk, the degree of which in conjunction with courage and patience, which can be justified only by the high profitability of an invened high-tech enterprise in the late stages of its development.
Taking into account the degree of risk, and the fact that in case of unsuccessful investment in the company, the investor will lose all invested funds, capital owners in order to reduce risk, are directly involved in the management of the company, entering the board of directors, as in investing business angels. For the same reason, venture capitalists often take personal participation in the selection of investment objects, and there are always several venture operations at the same time, therefore, they are ready to work with both new and acting, as well as those who are preparing for the sale of companies.
In order to reduce risk, a venture capitalist, as a rule, distributes its assets between several projects, although it is not excluded to maintain one project by several investors. For this, in the venture introduction of resources, step-by-step financing applies. Funds are allocated by small portions of "tranches", in the slang of venture businessmen, this means "through the dropper", i.e. Each subsequent financial infusion is possible only after a successful previous one.
Also, venture capital investors, investing there, where the bank (for considerations of caution or by the Charter) to invest is not solved, they are not just a package of ordinary or preferred shares. But also discuss the condition (acquiring privileged shares) on which they will be eligible when the critical moment is made to exchange them on simple, in order to gain control over the "clutter" company similarly and try, a fundamental change in the strategy to take it from bankruptcy. Such actions are quite justified, because Venture investors go to a huge risk, passing their funds into the share of other companies, counting on high profits, characteristic of the most successful companies in the field of high technologies, the price of whose shares, in 5-7 years increases several times.
A decisive role in the successful activity of the enterprise often belongs to the quality of management actions, and not a fundamental idea, which is the basis of the technological process and products. Therefore, a venture businessman, less attention pays the intricacies of a scientific idea, and prefers to thoroughly assess the potential opportunities for the capitalization of this idea and managerial abilities of the head and administrative link of the company.
A venture investor continues to work with a supreme company until it just firmly "will be on his feet," but will become a "tight piece" for potential buyers. Upon the occurrence of such a moment, the former owner of the invested funds, and now the owner of the share of the package of shares, considers his mission over and comes out of investment, released the funds frozen for several years and receiving well-deserved profits.
For the output of funds, the venture capitalist has two quite real options:
And, despite the fact that venture investment is inherently characterized by the risk, it is this excessive risk of investing an unknown company represents the most significant limiting factor for a potential investor, reflecting where to invest free capital with the greatest benefit. Purchase shares of oil business, to invest in a new company, developing tomorrow's technology, which is fraught with risk, or put funds to the bank, at least under low, however, a guaranteed percentage.
Although absolutely non-rated financial transactions, in principle, do not exist - life is replete with examples, when the collapse of oil companies and become the most reliable banks (here the Russians are memorable paints in 1998), and that risk, many seemed So big and more than obvious, in reality turned out to be clearly exaggerated. In addition, it turns out that one who dares to take a chance received a very weighty bonus for his risk.
Another very significant sign of venture investment is that venture financing always reacts very sensitively and takes into account its trends. Most often, investing in those sectors that are associated with the rapid and profitable possibility of selling highly technological high-tech products, which already uses attractive demand, or this demand is only formed, and threatens great profit.
For example, at the end of the last century, the massive hobby by reading CD devices began, and immediately in this industry became venture capitalists with a big hunt and at profitable facilities for companies to invest huge funds. And with the departure of this fashion, dried and stream of investment. The same phenomenon was observed when there was a cooking hobby of cell phones. It can be predicted in the near future to cease to be in high-tech services to ensure access to the Internet. Of course, after some time, the profitability of software for personal computers will lose a cost-effectiveness, which will also lead to a reduction in venture investment in this industry, since there is no venture investment, and in principle there can be no permanent sectors of the economy, forever attractive industries. Alternative will be only the desire of venture capitalists to multiply their funds.
Based on the foregoing, the conclusion is appropriate: venture investment will always be attractive for those who will not be afraid of the initial non-reliquia of the company's shares, risk, and for a long time to "freeze" a certain part of its capital for the embodiment of an innovative business idea to life satisfying the new needs of people and the subsequent Production of super-profits, and non-maritable.
Thus, this type of investment is a kind of cash investment in new high-tender companies in order to ensure their formation, subsequent development and growth to obtain super-profits as a result of the successful completion of the project. That is, it is an investment of private capital into small, but promising high-tech companies that will produce high demand in the future, which are in great demand.
But it is not worth the parallel between venture capital investments and financing associated with greater risk, as well as equalizing them, as any type of financing, including the easiest loan, or the doomship of money acquaintances - contains a certain share of risk.
Prepared by editors: "Business GID"
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Stories about incredible stories of success cause each of us constant interest. People are rich in months. And they become not just secured, but firodally rich. It is unlikely that there is a person in Russia who has never heard about Google, Aliexpress or Apple. Not so long ago, it was only the ideas of creative people who walked up with the times. Not all are able to create innovations, but almost everyone can invest money in them to earn no less than the author's idea! Today it will be about venture investment!
Creative people with great potential often do not have money for the incarnation of their ideas into life, so they attract those who are ready to finance them with all their might. For this investor receives a share in the new business and reaps the laurels on a par with the developer. It is worth understanding that we account for not only success, but also failures in the event of a negative development of events. This is called investment risks!
What is hiding behind this concept of Venture Investments? The name speaks for itself! Venture is translated as a "risky enterprise". Investments - investment of funds in order to obtain income. As a result, it turns out: the risky investment of capital in innovative projects and business ideas, in order to obtain a profit, which, if good luck, exceeds income from any other type of investment.
As practice shows, losses from several unsuccessful startups with interest are covered with one successful! Therefore, there is a concept of a "venture investor" - this is a person who finances exclusively risky innovative enterprises. Those who do not understand the meaning of the term "startup", we recommend the article.
Venture Investments is usually associated with innovative ideas, since only they can give a truly high income, which sometimes reaches 1000% of the invested funds. Other business ideas can also fire their place under the sun, but they will not give so high yield. Profit from investment will be average in the industry, even subject to incomplete or weak market saturation. Only a new idea that answers the challenges of modernity can "blow up" and bring great success to the creators. In the last decade, the most profitable startups relate to the spheres of IT, medicine and high technologies.
Risk investments have a number of characteristic features. Some of them are strong parties, others on the contrary - weak.
The benefit for the novice starter is obvious: the required amount will be allocated for the project, which he himself is simply not available in 90% of cases. At the same time, he remains the author (ideological inspirer) and gets most of the profit, often without putting a penny! For an investor, the benefit is that invested in a venture project, he receives a lot in a very promising business. Please note that finallying the case is 100%, it is rare to get more than 50% of the company! In the startups, the idea is valued above the funds for its implementation. Nevertheless, it is still profitable! 2
Often, investments are needed at the "grinding" stage of ideas. When there are only planned calculations of future financial indicators. This is perhaps one of the weaknesses. The planned indicators of profitability are an extremely unreliable indicator. Approximate it to reality is impossible due to the fact that the business just begins. There are no reports and data over past periods, on the basis of which it would be possible to make an accurate forecast for the future. Be very attentive when choosing an object for investment, because there are a lot of fraudsters among startarters, which will provide a colorful and very convincing business plan, and then disappear in an unknown direction with your money!
If it does not ignore the case, then the money will lose only the one who invests them. The starter is not obliged to refund, since the degree of risk was known in advance. The depositor provided funds for the implementation of the idea voluntarily, having no guarantees. Of course, it happens that money is provided in the form of a loan on a return basis, but this is a rarity.
No other type of investment will bring such income as an investment in a successful venture project! One good luck can be more than overlapping the expense of nine previous failures! For example, Google Inc appeared in 1998, thanks to investments in the amount of $ 100,000. After 6 years in 2004, its creators became billionaires!
The fact is that startarters do not always have experienced entrepreneurs, so the contributor's assistance will be eagerly. Their relationships often go beyond formal and they are working together for the success of the case! Especially successfully, if the investor has the necessary knowledge and experience in entrepreneurial activities. He can take on all formalities, and the author of the project will be able to continue to develop the basic idea.
In a venture project, the author and the depositor do not compete with each other for the seizure of the main share of business (a controlling stake in shares), they work for achieving a common goal - profit. All relations between them are enshrined in the contract. For the capital owner, the startup is, first of all, an object of investment, and already on its own business! Therefore, the achievement of high yield is the main goal, personal ambitions are departed into the background. The unity of the creators always has the best affects the development of the case!
Venture investments are also distinguished by the fact that it is impossible to predict when the profit will be received. Business can develop very rapidly and after a year the distribution of income between the authors and depositors will begin, and sometimes you have to wait for several years. Usually venture firms legally declared in the form of LLC or joint-stock companies, which makes it easy to attract additional capital and redistribute earned funds. Even if the idea immediately got a good response, the first profit is usually not distributed, because the enterprise capitalizes in its account. That is, income reinforced and is spent on the expansion and needs of activity. When the business ceases to need a permanent additional influx of capital and will be in stability, then the payment of dividends to shareholders will begin.
Fact 1. The world leader in the financing of venture projects, of course, are the United States of America. The volume of this market segment is about 20-30 billion dollars annually. This situation has developed due to a serious legislative framework that protects investments.
Fact 2. No other country of the world approached this indicator. If you fold the volume of venture investments of countries such as Hong Kong, United Kingdom, Australia, Israel, it will not work 15 billion dollars.
Fact 3. Assess the actual amount of financing of venture projects of the Russian Federation is not possible. The reason for this is a strong relationship with offshore investment accounts.
Fact 4. The most profitable venture idea at the moment is Alibaba. His founder is a Chinese teacher who has created a mediator's company between sellers and buyers. It is impossible not to notice its similarity with such projects as eBay or Amazon, but there are fundamental differences. For example, all Chinese production products, the price of them is fixed and there is no auction. At the first stage, investors of the ideological inspirer Jack Ma made his friends who did not have to regret their decision. The volume of investments amounted to only $ 60,000. For comparison in 2015, profits amounted to $ 77 billion, which at times exceeds the income from American analogues.
Fact 5. On the heels of the Chinese, the Americans are coming. Rather, American Mark Zuckerberg with his grand child - Facebook. Venture firms have one very important indicator, which is called primary public placement, that is, the output of shares in free access to the stock exchange. Most often in the media there is English abbreviation - IPO. The most important parameter is the company's cost at this moment. After some time, analysts estimate its current value. The difference determines the success of a venture enterprise. Facebook at the time of the IPO was estimated at 16 billion dollars. After a short period of time, the company's cost was already 104 billion dollars.
Fact 6. The leader of the segment in Russia is the project of Yandex. The only venture company that went to the IPO. Prior to that, the company was estimated at $ 8 billion, after - only 9.8 billion dollars.
All who are engaged in investing venture projects can be divided into five large groups:
We are talking about a private person who is ready to invest in the case, which he seems promising. An important point is that it is only a profitable business idea for him and nothing more. It does not interest him in which field will function a venture company, the main availability of a convincing business plan will function. Money that invests should be called venture capital. An attachment into a promising business can be both sole and cover only part of the amount required. In essence, each of us, having decided to try herself risk investment becomes a venture investor. It is important not to confuse VI with business angels, about the essence of which and the distinctive features will be talked below.
This is one of the types of mutual investment funds, which are described in detail in the article..
The object of investment is, of course, venture enterprises. The capital of the Foundation is formed by investing individuals. We are talking about the trust management, in which the contributor does not solve independently in the Central Bank of which companies to invest. For him, everything solves the management company. It is worth noting that it usually can be trusted. Venture investment is her professional activity, which gives very good results. In addition, funds are convenient because the attachments are diversified. This means that capital is distributed among several starters, which significantly increases the likelihood of success of investments.
In addition, VEF is very carefully choosing investment objects. The business plan should be very detailed and competent, special attention to the novice strata has to pay a justification for economic efficiency. Most often, preference is given to those entrepreneurs who have experience in the experience of successful creating profitable business.
Private faces that have modest investment opportunities are best to contact the venture capital investment fund, since the fund takes even small investments. At the same time, capital receives the highest possible protection during risky investments.
Under the financial structure, the Group of Companies is intended by the general guidelines with a wide range of interests. For example, a group of VTB, which has more than 20 companies functioning in different segments of the financial market. Such groups sometimes finance startups. Such activities are rarely regular. It is quite difficult to achieve money. The business plan should be truly reasonable. But for the developer, the idea of \u200b\u200bcooperation with such a holding is very beneficial to the fact that at its disposal there is a huge resource, both financial and personnel. Organizations of this kind are in all their forces protect their investments, so they will provide all the necessary assistance to the entrepreneur.
Such a poetic name is completely not inherent in dry financial terminology. It appeared at the beginning of the 20th century. Business angels called very wealthy people in Europe, which invested their capital in performances. Now such people are called mostly producers. And the concept of "business angel" has acquired a little different meaning.
Now they are so called people who invest money only in those areas that they are close to where their own skills can be useful. That is, the essence of investment in the case of angels is reduced not only to get the highest possible profit. An important point is the practical application of its skills and moral satisfaction from the process. This is the main difference from venture investors. Who are business angels? These are millionaires with excellent education. Most often they invest money in high-tech startups.
Of course, each starter seeks to find a business angel as an investor! Because in this case there are no long-term approval procedures. Often everything is solved in conversation: either interested, or not. In addition, BA most often finances an idea in full.
The state also participates in investing venture enterprises. But in order to get this money, a novice entrepreneur has to overcome bureaucratic obstacles. It is necessary to reach each instance, stand up, draw up a competent business plan. And this is all just to participate in the competition. And then it remains to hope that the project will consider sufficiently convincing and allocate funds under it. It is worth considering such a factor as bribes. The project can win if you pay the right people on time. Therefore, it is worth forgetting about honesty.
There are two options, how to start investing in venture projects. It all depends on your abilities, desires and, of course, opportunities. So owners of decent capital who wish to accommodate it profitably can do it on their own. And those who do not have a large amount will have to take advantage of the intermediaries.
So, if you have several thousand dollars who want to post to get the maximum benefit, then what needs to be done.
Step 1. Choose a segment in which there is a desire to invest money.
Of course, it is better to choose what is close and familiar to you. If you understand programming, it is better to choose a startup that is directly related to writing programs or applications. The fact is that you will be much easier to appreciate the realism of the idea, its demand and feasibility. You can also evaluate which volume of investments will be needed.
Step 2. Select the project.
Where exactly look for startups for the first investment will be talked separately. When you already have experience in venture financing and truly large capital, entrepreneurs themselves will find. So, choosing several options you need to evaluate their prospects. These parameters are important: a business stage (start, access to profit, expansion, stable operation), the essence of the idea, the required amount, financial calculations. Naturally the most risky investments are those that need to be investigated at the development stage. Any investor is happily invested in a business that has already paid for profit and showed its viability.
Step 3. We conclude a contract.
Quite often you have to invest ideas that are not issued legally, that is, there is no LLC or JSC. Therefore, it is legally quite difficult to arrange it, so it's best to wait for the creation of Yul, after which to invest.
Naturally, the easiest way at the first stage is to create LLC. In Russia, few startups go to the IPO, so the joint-stock company does not make sense. Then may three options:
The last option is the most risky, since there is no sufficient legislative framework to protect the depositor. It is best to make money in LLC at the stage of its creation, or make a convertible loan, which can be exchanged for the company's shares if it is re-registered with a joint stock company.
Step 4. Take an active part in the company's activities.
When all the formalities are settled, it's time to make efforts for the success of your investment. To do this, keep track of all business processes, help your knowledge, connections and so on.
Step 5. We make a profit.
In the ideal situation, the company will start selling its shares on the stock exchange. After entering the company to a stable profit, you can sell shares. Most likely, the profit from the initial investment will amount to hundreds of interest or even more. Such shares will gladly buy investors who invest in low risk tools.
If the venture company will remain a Ltd., then having a share in business, you, one way or another, will receive income from your investment. A share in society can also be sold if necessary.
Those who do not have enough funds for large investment should not be upset. There is always a way out! Therefore, the best option will be the acquisition of shares in the venture capital investment fund, which we have already mentioned earlier.
Step 1. Select Foundation.
Step 2. Opening an account in the bank.
Step 3. Visit to the Foundation.
Step 4. Transfer of funds from your account to the FIF account.
Step 5. Obtain a confirmation of the enrollment of the depot of the Panel's account.
Step 6. Sale of shares, when the price of the PAY will grow to the desired level.
Through venture investment funds to invest very simply. You only need money transfer. All other work will be performed by the management company and the depositary.
At the beginning of the activity, the investor may encounter the problem of finding a suitable project. It is difficult to offer an option that will be suitable for everyone, so we will offer three at once.
Option 1. Friends, acquaintances, colleagues, relatives.
Probably, now you thought that no one has a great idea for a startup. But it's not about themselves, but about those who know your acquaintances. There is a theory that all people are familiar through 6 handshakes, so to find a person you need to communicate as much as possible. Perhaps your friends know a person who knows a person and so on. The search for a startup is problematic only for the first time. Then you simply "turn out" the necessary dating.
Option 2. Exchange.
Internet capabilities are affected by imagination. It does not fail and in the case of the search for a venture project. For quite a long time there are sites that combine investors and entrepreneurs among themselves. Such intermediary services are called stock exchanges. For example, Inproex.ru.
Option 3. Collective investments.
There is another type of stock exchanges that offer all operations on the purchase and sale of promotion of venture firms directly on the site. You independently form your investment portfolio and choose which projects to invest. Such platforms offer many I / O options, including through electronic wallets. A bright representative of the Exchange Exchange is ShareInstock.
For those who do not want to independently take investment decisions, it is best to trust professionals and invest in specialized venture capital funds. We have compiled a rating of the best, whose activities are tested by time.
Which fund to entrust your funds to solve only you. It is important to assemble the maximum information on the basis of which the decision must be made.
