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Opportunities and prospects for using venture capital- according to professor Anokhin’s opinion

This capital always has the likelihood of a risk.

08.Feb.18 11:03 PM
By Natalia Klyachina


Opportunities and prospects for using venture capital- according to professor Anokhin’s opinion
Venture capital refers to direct investment in a joint venture. Because the investor after that becomes the owner too. This capital is considered risky. The share of the probability of risk is always present. Most often, venture capital financing is used. You can also use lending. The well-known Professor Anokhin believes that corporate investors adhere to strategic goals when they decide to invest in the project. As we know, investing is investing money in a project in order to make a profit after a certain time. During this time the enterprise must increase its own value of assets. As a result, the value of the shares of such an enterprise will also increase.

At the initial stage of the project, it is very difficult to estimate the future value of the enterprise. Therefore, investors carefully check and study the business plan with great care. They are interested in viability projects. A bank, for example, when issuing a loan is more often interested only in income. But the income received is not always an indicator of the effectiveness of the project. If the organizers of the project do not prove future benefits to investors, then they have little chance of getting an investment.

It should be borne in mind that venture capital is not suitable for all businessmen. It is known that one fund invests a maximum of one project out of 400 applications. Enterprises that promise a large financial output are more attractive and risky. These two factors appear simultaneously. Also, this way of attracting cash is very expensive for the company itself. But those who immediately need a lot of capital to start, this method is quite suitable.

Venture funds work in different forms. They can invest geographically or invest in a particular industry. For example, investors may be attracted to projects that are in certain life cycles. There are also universal investors who combine all these principles when choosing an investment object. It is important to know that venture capitalists, unlike venture firms, are guided by different rules of choice. Firms usually invest only in starting projects. And the capitalists can come to the project already at a certain stage of his life.

There is always an alternative to venture capital. In this issue, it's business angels. This is a private investor. He helps projects in the earliest stages of work. Such investors appear when the company has a high potential for rapid growth. Such projects require rapid investment.

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