Tag Archives: Venture Capital
It is rare to use animal imagery to describe the business activities of a firm. However in terms of looking at the issues of business equity, I feel that it is appropriate in this case to describe how a business tries to survive in the market. If the company is taken to be like a living organism, then the entrepreneur is the head, while the cells are the business equity.
General Sources of Funding
Where an entrepreneur is in a position where they either need money for starting a business or need money to extend the life of a business, there are a variety of sources of funding for such activities. Apart from business equity, the entrepreneur can finance the whole project on his or her own. This means that they enjoy all the profits but they take all the risks. Because of the high level of risk involved, some business owners are reluctant to go down this route.
There are various means of raising capital and the corporate finance team will be well aware of all these methods. It will also be aware of the risks involved in raising capital from external sources, let alone the relative loss of control of the firm’s business that is often a result of the acquisition of external funds. In this article I will be looking specifically at how funding can be received from within the company’s own internal networks.
The relationship between venture capitalists and corporate finance officials is of interest to everyone in any given firm. As a source of funding, venture capitalism has a somewhat sullied reputation for exploitation and asset stripping. When an organization becomes aware that there will be a venture capitalist challenge to its funding, the members of staff automatically start worrying about their jobs because they believe it is the next step.