Venture Capital- What and How

Abstract

Venture capital means funds made available for startup firms and small businesses with exceptional growth potential. It is the money provided by professionals who alongside management invest in young, rapidly growing companies that have the potential to develop into significant economic contributors. The emerging scenario of global competitiveness has put an immense pressure on the industrial sector to improve the quality level with minimization of cost of products by making use of latest technological skills. The implication is to obtain adequate financing along with the necessary hi-tech equipments to produce an innovative product, which can succeed and grow in the present market condition. Unfortunately, our country lacks on both fronts. The necessary capital can be obtained from the venture capital firms who expect an above average rate of return on the investment. Present paper is just an attempt to understand the conceptual framework of venture capital.