Volume : VII, Issue : II, February - 2018

A CONCEPT OF VENTURE CAPITAL

Shaik Khasimsha

Abstract :

 

Capital is one of the most important factors of production. No entity can start functioning without required capital as this helps the entrepreneurs in acquiring machinery, equipment and other productive facilities. The companies engaged in traditional line of business can easily procure necessary financial capital from the conventional capital market. But the entrepreneurs face great difficulty while venturing out to procure financial capital for newly floated enterprises as at the initial stages of business the risk is very high and the return, quite uncertain. Common

Investors hesitate to invest their savings in such companies even though they leas to high industrial growth and economic development, because it is difficult to trade–off between risk and returns. Lack of finance deters the new entrepreneurs and technocrats from starting new ventures even though they may very well have innovative ideas and requisite technological knowledge. Hence the question arises that how these types of firms shall then be financed? Under the circumstance, the concept of venture capital fund was born with fundamental objective to provide initial capital and support in building capital base to the entrepreneurs, having a sound background of professional education, expertise and initiative to launch the business based on fast changing technology.

Article: Download PDF    DOI : https://www.doi.org/10.36106/paripex  

Cite This Article:

SHAIK KHASIMSHA, A CONCEPT OF VENTURE CAPITAL, PARIPEX‾INDIAN JOURNAL OF RESEARCH : Volume-7 | Issue-2 | February-2018

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