Question

How can you Find the Right Venture Capitalist?

what is the right source of finance for a venture?

Answer 1

To find the Right Venture Capitalist, it is important to :

a. Check the expertise and experience of the Venture Capitalist within the industry, while knowing how many ventures they have financed to check their credibility for the pay offs in the long run.

b. Instead of merely depending upon raising the capital from the venture capitalist, ask for their help, especially if the venture is a startup, as getting their counselling and networking experience is invaluable.

c. Right Venture Capitalist for the business is the one who has similar vision, goals, and commitment as of yours, so that the long term growth can be achieved.

d. Venture capitalist who are straightforward regarding their terms and conditions are always preferred over the ones who have in-transparent terms and conditions.

The right source of finance for a venture depends upon various factors such as : Business capital requirement, establishment in market, product or service type, startup etc. Various sources of finance for a venture are as follows :

a. Angel capitalist : These are the individual investors who help to grow the venture for economical return. They especially invest in the ventures who has innovative products or services which are more likely to get successful in the market.

b. Bank Loans : These are the personal loans for the business where the bank take interest on the money lended for a fixed time it can be either quarterly or yearly. Such finance is right if the venture has unique idea and can grow in the future, to repay the outstanding loan amount.

c. Crowdfunding : Here, the capital is raised through crowdfunding platform where the individuals contribute to finance the venture, this type of source is right for the venture who requires small investments.

d. Family and friends : The capital is gathered from borrowing the money from family and friends as they have low interest rates.