Venture Capital Magazine

Low Jeremy




It’s a risky business, but still, somebody decided to do it. Venture capital is a sort of financing scheme that funds businesses that have been found to have some growth potential.

Venture capital is also called risk capital. For businesses that have very limited start-up capital, they could go find a venture capital investor. But for the venture capitalist, they still need to weigh the various risks involve.

A venture capital is an investment that is basically provided by third-party investors. This investment is usually used for enterprises that were deemed to be too risky that even the standard market investors or banks avoid putting a single cent on them.

Although this kind of investment would be very advantageous for entrepreneurs that cannot find funding through regular means, some people still avoid venture capital due to the fact that venture capital investors usually have the power to intervene and run the company itself aside from being part owners of the company.

For the venture capitalist, Arkansas might just be the place to look for businesses to invest in. Cities like Charlotte and Fox offers more than what you think. Venture capitalists’ expected high rate of return might be present in such small, sleepy towns. Likewise, for a small business in Charlotte having some venture capitalists will give them a couple of benefits like funding, management assistance and lower costs over the short term.

The local government has been grooming Charlotte to become a great city. Some even dubbed the city as the next Atlanta. The government has been building infrastructures, setting up a better environment for businesses or entrepreneurs. And just like the state of Arkansas, Charlotte is as diverse.

People of all ages and socio economic backgrounds converge in a city where they decided to call home. The city has some huge potential locked away. It’s just up to people like risk taking, business minded individuals and venture capitalist to unearth this huge potential, harness it, and develop it into a full blow and lucrative investment opportunity.

But venture capital also needs some push from local business and entrepreneurs. Venture capitalists tend to act more aggressively if sound proposals are being presented to them.

It is therefore important that people in Charlotte start believing in their capabilities and potential and begin reaching out to the wealthy investors across the country. They need to come out and declare that people in Charlotte are ready to play with the big boys of business investments.

Mabel Miles




Business plans made by an individual requires a strategic plan that is sure to make a business grow. When you decide to put up your own business, a need for you to release an enough amount of money is required. Every business involves money since this is the main foundation of everything related to business. Businessmen are required to venture into capital before everything starts up. The capital for every business depends on how big the business would be. Businesses are offered in different branches and productivity. Services, products, real estate are just some of the different kinds of business being offered in the market at the present. When we talk about service kind of business, this could be about transportation, spa and communication types. This kind of business is typically the most expensive line. This comes for the reason that when you choose to render services, you are required to hire a major labour workforce to make the business function. One example for this one is the telecommunications companies who are usually following the corporate capital venture.

When we talk about venturing into the capital sense of owning a business, this could some up to the kind of ownership a business has. Typically there are three types of business ownership being practiced in venturing into the business world. This comes in the form of sole proprietorship, partnership and corporation. These three types have their own advantages and disadvantages. Let’s start with the first kind of business ownership which is the sole proprietorship. When you decide to have your own business you can have a choice to be the sole owner. This one is ideal for a small kind of business, it is better to start small and flourish to a bigger and successful one than be the other way around. Sole proprietorship would require you to do everything on your own when it comes to producing the capital and the things that go within it. One given disadvantage for this kind of ownership is the consequence of paying the business tax without anyone to share it with.

The next kind of ownership for capital venture is partnership. A business is called a partnership when you have someone or two individuals to share the capital and the cost of building that business. This one is ideal for a mid size business, however the given disadvantage for this one is the fact that when you venture into partnership you will have to share the profit that you have gained to that partner/s. It is also an advantage when it comes to paying the business taxes for your business. The last kind of business ownership comes in a form of a corporation/company. This one is commonly practiced by business man who owns a certain amount of stock in the business venture. A committee is built to identify the stock owners. This kind of business is ideal for multi million companies who does not only render service in a certain place but are also nationally or internationally. We are talking about a big amount of money for this kind of ownership. Sometimes the main capital that corporations venture would not be under a million.

Damian Sofsian




Venture capital represents financial investment in a highly risky proposition in the hope of earning a high rate of return. While the concept of venture capital is perhaps as old as the human race, the practice of venture capitalism has remained somewhat fragmented and individualized through its long history. Only in the last four decades or so has the field of venture capital acquired a certain coalescence, maturity and sophistication, particularly in the US.

The origin of venture capital in its modern form may be traced to General Doriot, who established the American Research and Development Fund at the Massachusetts Institute of Technology in 1946, to finance the commercial exploitation of new technologies developed in US universities. The small business act of the US permitted the Small Business Administration to license and even support financially small business investment companies engaged in venture capital finance, provided fuel to the growth of venture capital finance.

Larger companies in the US like Xerox, 3M and General Electric entered the field with their venture capital divisions. These examples from the US stimulated the development of venture capital throughout the world. Though the initial efforts made in the early seventies to introduce venture capital were rather unsuccessful, the changed environment of the eighties witnessed a phenomenal growth of hi-tech industries and provided a fertile ground for the blossoming of venture capital.

Venture capital plays a helping hand in the financing of startup and early stage businesses, as well as businesses in “”turn around”" situations. Firms raise funds from different sources. Some funds like share capital are kept permanently in the business. Some funds like debentures are kept for long periods; while some funds are kept for short periods. The entire composition of these funds in an organization is generally termed a financial structure. Generally, the short-term funds are excluded since they are shifting often and the composition of long-term funds is known as capital structure.

John Michael Kelly II




Like most entrepreneurs you are likely in love, head over heels, with your baby… your new business venture. You have toiled on the idea for months or years even. You have thought out every minute detail in your head and, perhaps, even put it all down on paper. You are convinced your venture will be a winner and now only one thing stands in the way of your dream becomes an exciting reality…money.

Whether you need several hundred thousand dollars or several million to get your venture off the ground securing financing is inevitably the most frustrating and mystifying part of the process. Most well- intentioned entrepreneurs with worthy projects don’t even know where to begin in looking for money, and often head down dark paths with unscrupulous individuals who will never be able to advance their vision into a reality.

The funding maze can be daunting, intimidating and more often than not a fruitless journey to nowhere. With today’s conventional lending environment being so dismal for small businesses and start ups is there any hope for you to breathe life into your baby? Absolutely there is, but ONLY if you employ the right financing strategy.

There are three critical “Post recession” rules that you must understand and employ for any hope of achieving financing for your project. The good news is once you understand the proper strategy to package and position your business you’ll be on your way!

The Right Lender

It may seem overly obvious but unless you get your project in front of a willing and able lender you will not get financing. So what is a willing and able lender? Today that is a private lender and certainly not a bank. Angel investors, venture capitalists and private equity lenders are all very active in today’s lending arena. While 97% of the population has been moaning over the “Great Recession” these lenders, the top 3%, have been buying everything at half price the last three years, building their wealth and investment capital. But here is the catch…you have to find a lender who 1) has the available and liquid capital to invest in your project and, 2) is willing to invest in your specific type of industry and project. Angels will typically only invest within the industry in which they made their wealth, while venture capitalists typically invest in an entrepreneur’s reputation. If you have built successful businesses before you new venture may attract the interest of venture capital money. However, if you are new to the game an angel investor will likely be your ticket. And these investors will quickly be able to determine whether or not your business plan “works” or not.

The Right Plan

Plain and simple…your business plan is everything. It is the lone document, your singular chance to impress a lender and move him or her to take action and finance your project. Tragically 95% of all business plans are DOA (Dead on Arrival) because they are inherently flawed in format, content and mathematical viability. In short these fateful plans can’t possibly work and would be torn to shreds by a lender should the plan every make it in front of one!

Business plans written by entrepreneurs are typically done using a template from the Internet that was designed to be utilized for submission to a bank, not a private lender. 99.9% of all business plans written by the entrepreneur are overly verbose and overly subjective. Lenders look to the business plan to be 100% objective, to point out inherent downsides to the business in assessing the risk factor of possible investment. These plans are not concise and don’t provide the specific data private lenders MUST see.

If that isn’t enough to disqualify your plan nearly all business plans are written exactly the opposite way they should. They are mistakenly written with a flowery description of the business vision, maybe a mission statement, a look at the industry and why this venture will succeed in the marketplace, a marketing section and BAM into financials. The financials are most likely built to support the business plan suppositions in the preceding sections. They are often guesses and always impossible to achieve.

An “elite” business plan, on the other hand, requires that a series of specific questions be answered in advance of writing the plan that will dictate the “hard” financial variables required. Once these “hard” variables are determined they will dictate the process and strategy for developing the financial projections and then the entire content plan itself is a result of these financial certainties. A plan written backward to forward stands an infinitely greater likelihood of seeing money than the way 99.9% of business plans are written!

The Right Words

So you now have your project in front of an able and willing lender, with an elite business plan that “works” for him or her to review. Then you get the phone call…”I’m highly interested in financing your project. Can you be in my office next Tuesday at 3pm to meet?” All of a sudden you are excited and terrified at the same time! At this stage there is likely a 75% chance your project will get financed. However a very large step remains that must be taken with precision for you to reach the financial end zone.

When you speak with a lender on the phone and, for sure, when you meet with a lender face to face there are CRITICAL words and phrases to say and NOT to say. The reality is that you will likely get less than ten minutes in front of a lender to “close the deal.” The wrong words will literally sink your project. Not only do you have to convey supreme confidence with a lender it is equally important is to sound incredibly competent. After all, you are asking this person to invest a significant amount of money with you. They do not and will not make the mistake of investing in the wrong person, despite how great the project may be.

Unless you are schooled as to the intricacies of this monumental interaction with someone who can change your life forever it is a crap shoot. If you say too much or say too little it might be an indication to a lender that you are not a good investment risk. 95% of all projects never make it this far, so look to someone who can help role play with you on what to say and not to say. Properly orchestrated your face to face meeting with the lender will be a resounding success and the last test to finalizing your financing.

In summary there are undeniable rules of the financing game for entrepreneurs to follow in their quest for financing…ignore them at your own peril. The good news is that if you follow the blueprint I have laid out for you here by employing an impeccable financing strategy you will rise to the top of the heap and stand an excellent chance of turning your dreams into reality.

William G Davidson




Many of us believe that we have the next multi-million dollar idea that will revolutionize an industry. However, funding is usually the greatest obstacle in order to get a project off the ground. Raising capital is not an easy thing to do in any economy, much less an economy that is struggling. Elevator speeches and fancy poster board presentations will get you as far as the front door of an office, if you’re lucky.

The objective of any VC is to financially benefit their investors through your company. They will buy in, filtrate whether or not it is successful, and find an exit strategy. It is important to be fully prepared when using venture capitalists for your business. Here are five basic guidelines to follow when funding through venture capitalists.

1. Its Launch Time
Most all venture capitalists are not looking to buy an idea, but are looking to see how well you have launched your company thus far. If they see you didn’t put forth the effort of starting the company, they won’t put forth the effort for you in funding the company. Business plans are as useful as a stack of old magazines to investors because no venture capitalist will read one! Spend the time on making your business startup successful rather than behind a computer typing out a 100 page business plan. You do not have to have your company in a fully operational stage, but you should have the ability to show the investors that you have initiated a successful startup for your company. Let the investors know the direction you see the company going in and ask for the funding to allow for your business to continue in that direction.

2. Know the investors
In today’s market, most venture capitalists work through large companies, sometimes making it more difficult to find the personal business relationship most people predict they will find. There are different types of investors for the startup phase, expansion phase, and the buyout phase. It is important that you make it clear which type of venture capitalist you need to speak with before you ask for funding. It is hard for any individual to give money to someone they do not know or trust. Do your research before going into any meeting and look up company websites to see what type of companies they have invested in. Ask current companies how their experiences have been through funding with that particular venture capitalist. Most importantly, when looking for an investor, make sure that you take any and all information that they have to offer you. They would not be investing if they did not have an idea of where your company can go, so it is important not only because of their financial backing, but their business experience as well.

3. Back to the basics
Once you have started your company and know exactly what type of investor you are looking for, it is time to prepare your presentation to the investors. Make your pitch simple enough that a group of third graders could understand what your business model is. If they can understand, any venture capitalist can as well. Dress to impress and show confidence in your business and the direction you see your business going in the future. Bring along samples or prototypes of your products so the investors can have a hands on experience and get a tangible idea of what your company can offer to them.

Take the time to stop and ask the investors if they understand what your business ideas and ask them if they have any questions. If they do have questions and you do not know the answers, simply say that you do not know. It is very likely that they will have the answers for you, which they can contribute to your business if they do in fact give you their funding. Lastly, make sure they know exactly how much funding you are asking for and what stake in the company they will be receiving for that funding.

4. Don’t put all your eggs in one basket.
It is likely that if a venture capitalist likes the business model you have shown, they will try and renegotiate the terms of their stake. It is important for you to be prepared before the fact with a written proposal for each individual. In this folder, you should include any information about your company, bylaws, current financials, and operating agreements. Showing your proposal to each investor will let them know your current thoughts and projections in the company, as well as set a guideline for negotiation. If your product or service is something that is highly sought after with investors, it puts you in control of the situation. If one venture capitalist sees that another investor is interested, it creates competition and will ultimately give your company credibility. Most likely this will make your negotiations favorable to you, driving each investor’s stake lower until you reach an agreement that you feel is best for your company.

5. Maintenance
Once your company is funded through a venture capitalist, it is important to maintain a relationship with the investors. Always remember, you may control the company, but the investors can pull the plug on your funding at any time so make them a major part in all decisions and include them in the success of your business. Maintain constant communication and allow access to financial reports to your investors, giving them peace of mind that you are running a successful company. Healthy relationships between companies and investors can lead to future potential expansion with the confident funding to back the projects.

Today’s economy is making it more and more difficult to find funding through banks, so many people are going through venture capitalists. Always remember when going through investors, make sure that you are prepared before asking for funding. Know exactly how much your company needs, and how much of your company you are willing to give up. Create competition between investors and always maintain a relationship with any potential venture capitalist that is involved in your company. If you follow these guidelines, using a venture capitalist to fund your ideas will be a smooth transaction.

Nazir Daud




In past years, attracting venture capital interest might have been considered to be a relatively unchallenging feat by most successful entrepreneurs and small business owners. With a sound business model and a good growth strategy, it seemed fairly straightforward to obtain the financial investment and support which was needed to boost the business to the next level. However, recent months have certainly changed the face of venture capitalism, and it is important to fully understand the most effective means of approaching investors in the light of the economic downturn.

There are many small business owners who have shied away from the concept of venture capital in recent times, for three main reasons. The first reason tends to be a general uncertainty as far as the economy is concerned. With global financial institutions and national banks collapsing in ruins as a direct result of risky or foolhardy investments, how is it possible to find a good, solid investor? The last thing any business needs is an investor promising the finance and then failing to deliver.

The second concern that entrepreneurs tended to have lately is that the investment itself is unlikely to be easy to obtain. Investors are clearly much more cautious when approaching potential business investments. This has tended to encourage small business owners to make assumptions about their own business model which may or may not be true. Specifically, one assumption is that their business is not likely to win the interest of investors, and therefore there is little point in trying.

The third issue facing business owners is the long term viability of their own business. Are their plans and hopes more than simple misguided dreams? If they have any doubts or worries about the future strength of their business, then clearly investors will see that lack of enthusiasm and pass them by. Any self doubts should be dealt with thoroughly before any capital is sought.

Venture capital as a concept has been around for at least a couple of hundred years, but it is only in the last couple of decades that private venture capital investors have sought to invest in smaller businesses. There are some venture capitalists around today who have a heritage much greater than a decade or two. For this reason there’s little point in a small business trying to secure funding from an investor who has generations of experience in venture capital.

Ultimately, however, potential investment will rest on a couple of aspects: the long term viability and profitability of the business model. For this reason it is essential for any business seeking venture capital to make sure that the core viability of their business is sound and has growth potential.

This makes sense, because in a world where businesses cannot take anything for granted, regardless of their size or heritage, it is essential that they are not deluding themselves into thinking that they have a profitable business in the making. Any good investor will have the experience and understanding to ask questions which pierce any flowery presentations and establish exactly how viable the business is, how profitable it will be, and what evidence and market research has been provided which does corroborate these facts.

It is facts, not fluff, in which the investors will be interested, and for exactly the same reason, so should the business seeking funding. To gain interest, today more than at any other time, it is essential for businesses to look critically in the nuts and bolts of their company, the potential, the market research and facts which can support their long term plans and predictions. Once they have achieved this then they are closer to gaining the interest of a venture capitalist or private investor.

Keith Davies




Business Loans Buyer’s Guide Introduction to commercial lending Reasons to take out a business loan Types of business loans What are your chances. Business loans are commonly used by business owners to access cash needed for business start up, growth or improvement. Standard business loans can take on several different forms in specific situations: Introduction to commercial lending Reasons to take out a business loan Types of business loans What are your chances. Lines of credit are more general business loans that are often set up to insure against cash flow problems.

Business

Your business might be a good candidate for factoring if you have: Fewer than three years in business Good growth prospects but less than stellar cash flow Active accounts but slow paying customers Find a factoring company in your area now. The business products and services we offer make it simple for you to handle vendor costs, pay bills, meet payroll and earn competitive rates on your cash. Banks are a common source of business loans, but they are often more conservative in their lending decisions. Regular Loans Between $20, 000 to $5 million is made available to small business operators many of whom would not normally be able to access loans from the regular financial institutions.

Bank

Banks are a common source of business loans, but they are often more conservative in their lending decisions. We need a banker that understands the world market, can review our summary, and agree in principle to fund the project with collateral that is acceptable to the bank. That will review the loan request, after determining that it is a viable / sound business situation, state in a “Comfort / Commitment Letter”, that they will fund my acquisition, because I do in fact have “access to”, a performing collateral provider, who can, upon receipt of this “Comfort / Commitment Letter”, structure a funding transaction, whereby the lending / funding source: ‘Will’ (first) receive a top 25 rated world bank’s *Bank Guarantee* (BG) for 100% principal and 8% interest, this to be authenicated, validated, certified, before lender / funder releases / transfers the 100% of the loan requested to the borrower’s (my) bank coordinates. So with the use of the Structured Note, the lending bank is fully secured as to the repayment of its principal and the receipt of its interest, without any lien on the project.

Capital

fund a startup business finance a business acquisition provide working capital for a business that can be used to purchase necessary machinery,. Your options for planning and presentation are many and various, ranging from seeking investment from venture capitalists (involving a high degree of planning and presentation) to self-certification (requiring very little financial information). Community Venture Capital Program Stimulate investment to promote regional economic diversification New Media Venture Capital ProgramStimulate investment in “new media” businesses Venture Capital Corporation Portfolioinvesting Administration and forms Eligible Business Corporation Direct investmentapproachAdministration and forms Q&AFrequentlyasked questions and answers StreamliningInformationabout exciting changes to the program processes Tax Credit Budget UpdatesCheck the status of each tax credit budget March 23, 2007. Each Venture Capital Corporations assessment of the market for their shares as indicated in their Request for Additional Equity Capital will serve as the basis for issuing equity allocations this year. Venture Capital Corporations rely on professional advice as part of their due diligence process to determine if they can invest in a small business. Venture Capital Corporations are able to invest in any small business that meets the requirements of the Small Business Venture Capital Act eligible Small Business Rulings are not required for a VCC to consider a business for investment.

Standard business loans can take on several different forms in specific situations: Introduction to commercial lending Reasons to take out a business loan Types of business loans What are your chances. While there are stringent federal guidelines about how banks and other lenders conduct business, there are no definitive standards as to how the various types of business loans are structured: terms and conditions may vary from one lender to the next, and minimum and maximum amounts can differ. As always, you are required to keep records related to your investments and compliance with the Small Business Venture Capital Act. Private investors or angels are a great source of startup business capital to help your new business reach success. Instead of moving in and taking over, Business Capital works with you to leverage what you have, assess what you need, and leave your business stronger — not weaker — when we’re finished.

Shyamala Sankaranrayanan




Venture capital is a new form of financing that has come as a boon for young entrepreneurs and it plays a strategic role in financing small scale enterprises and high technology and risky ventures. In all the developed and developing nations it has made its mark by providing equity capital, so, they are more like equity partners rather than financiers and they are benefited through capital gains.

As young and growing businesses need capital at the right time, not only to float their company in the market, but also to survive in the long run. When financial institutions like banks and other private financial organizations hesitate to take the risk of early stage financing, since the credibility of the budding firm is not established, venture capital firms comes into the foray to fund the project in the form of equity which can be termed as “high risk capital”.

Although there is a misconception that the interest of venture capital firms are mainly driven by cutting edge technology in the industry, it is not always the case with all venture capital firms. A venture capitalist associates high risk with huge profits. Of course after thoroughly analyzing the prospects and consequences and the viability of the project. The venture capitalist becomes a partner with the entrepreneur in his business. True venture capital financing need not confine itself to high end technology products, any risky idea with great potential can be financed and venture capital is an all powerful mechanism to promote and institutionalize entrepreneurship.

Mainly venture capital focuses on growth. A venture capitalist is very much interested to see a small business growing into a larger one. He assists in setting up the business, funding it and comes all along to seethe firm grow. If it is a potential equity participation, the venture capitalist can come out of the partnership once the company becomes profitable and take back his money by selling the shares or convertible securities. If the firm opts for a long term investment from the venture capital finance, the financier has to develop an investment attitude for a long term, say five or ten years to allow the company to make large profits.

Another form of financing is that the venture capitalist has his hands on management by which he becomes an active participant in the operations of the firm and his thinking is streamlined as to how to multiply and make quick money which is a win-win situation for both sides. Not only finance, the venture capitalist also contributes to marketing, technology upgradation and management skills to the benefit of the new firm.

The venture capitalist’s management approach is significantly different from that of a banker whose prime concern is collaterals and securities in the form of assets. He keeps his hands off the management and plays safe. The venture capitalist can also not behave like a stock market investor who invests money without having thorough knowledge about the company’s business and management. He combines the qualities of a banker, stock market investor and an entrepreneur in one.

Latest trend is that popular and giant software companies promote their content through the budding enterprises, by providing with the latest technology, training and expertise apart from finacing, which spreads the geographical area of operations of the parent company and also expand their territory to scale greater heights. Venture capital firms should focus on fostering growth and development of the enterprise and need not confine their interests only to finance technology, infrastructure, information technology services and the like. They need to diversify their investment in various sectors and even revival of sick units can be thought of as one of the options if there is potential in the business.

Marc Mays




When launching a new small business, often the entrepreneur will consider venture capital as a source of funding. Here are 3 tips to ensure that venture capital funding can be secured when sending out your business plan:
Send your business plan to the right people Venture capitalists tend to specialize in certain kinds of businesses. Some will specialize by industry, only investing in new energy companies, for instance, while others look for a certain size of company to invest in. It is worth doing the research to determine who the venture capital backers are for your industry, before you start sending out your business plan. Venture capitalists who are not specific to your industry can provide recommendations to make your plan more appealing to other venture capitalists. However, it would naturally be a mistake to send your plan to potential investors who will not even consider it. Make sure your business has the potential to be profitable enough Most venture capitalists look for a return of about 5-10 times their initial investment. For example, an investment in a company of $2 million should yield a return of $14-20 million after about five years. To satisfy these requirements, it is generally necessary to have a business which has the potential for a high rate of return on the amount invested. If the rate of return can reasonably be expected to be lower, such as for a clothing retailer, then it is probably better to look for an alternate source of funding, such as an investment or commercial bank. Remember to include an exit strategy for your investor Venture capitalists generally do not want to be involved with a new venture for an indefinite period of time. Most will plan to leave the new venture after about five years, so you should offer a clear explanation of how this may be achieved. There can be a variety of reasons for this; some venture capital managers require that the holdings periodically be sold off to acquire other offerings. Nonetheless, by demonstrating that you understand the limited time frame for many venture capitalists, you automatically make your plan more appealing than those which do not. In summary, by sending your business plan to the right people, by recognizing what rate of return is necessary for venture capitalist involvement, and by including an exit strategy, you can improve your odds of securing venture capital funding for a new and growing business.

Len M Williams




You have a great idea for a start-up business and you are, probably, short on capital, so raising money is your first concern. You are going to need outside investor groups, therefore you need to know the difference between angel investors and venture capital firms. Less is known about angel investing as compared to venture capital, due to the privacy of their investments. However, these are the key points to consider in order to make the right choice.

1. Ease of obtaining financing
It commonly takes less time to receive funds from an angel investor, as obtaining venture capital funds is a highly rigorous process. Therefore, your business should meet all the investment criteria before being considered by a venture capital firm. The difficulty with angel investors may arise in case your business requires funding from several investors, as they could demand different terms.

2. Investment Size
The range of venture capital funding is larger than the one of angel investors. Angels act alone or in organized groups and invest their own money. Venture capital firms are corporate entities that pool money from a range of investors. Angels typically provide under $1 million, venture capitalists mostly above $1 million.

3. Stage focus
The focus of angel investors is typically the earlier or the seed stage of your start-up company. Venture capital firms focus on different stages of your business. Vc providers are much less likely to invest at the seed stage and they may provide second round financing after angels. Moreover, their purpose is to take your venture to the initial public offering stage and beyond.

4. Industry focus
Angel investors vary in investment areas and may allocate funds to a range of fields, frequently within their areas of expertise. Venture capital firms generally concentrate on emerging sectors such as technology or innovation.

5. Geographic Focus
Both business investors often prefer to invest within the vicinity of their offices. The purpose is to add management value to your company and to easily monitor all their portfolio companies.

6. Expected returns
Both angels and venture capitalists generally expect a high rate of return for their investments. Stereotypically, a venture capitalist may have higher return expectations than an angel investor.

7. Expected Control
Angel investors and vc firms are similar in that they expect a board position and possibly a consulting role. Both invest in return for an ownership stake in your company and for a certain degree of involvement, but venture capital firms will exercise even more control over your company.

8. Support and Expertise
Angel investors will more than likely provide support and advice to the start-up business. Vc firms generally possess greater expertise, as they prefer to lead ventures through successive funding stages.

9. Risk taking
A venture capitalist prefers to invest in a business that will offer security and a high return on investment. An angel is far more likely to be a risk taker and put money into a venture at the riskier seed stage.

10. Motivation
Angel investors are also motivated by the desire to see innovative ideas get off the ground and become successful businesses, whereas venture capitalists are more motivated by profit.

As you need to maximize your chances of obtaining the suitable level of financing for your start-up business and minimize the amount of time spent for that purpose, a Venture Capital Firms, Angel Investors & Private Equity Funds Directory will make a difference.