Venture Capital: Funding for Innovative

If your business project presents an innovative profile can be directed towards financing the project equity loans or other activities of venture capital. Venture capital is taking stakes in the medium to long term and temporary a minority in the capital of small and medium enterprises with great prospects for profitability and growth potential.

Investment in risk capital is a very interesting alternative to capitalize on those SMEs that have difficulties in financing growth and expansion phases. The basic objective is that with the help of investment capital, the company grows, its market value increases, and once matured investment, venture capitalists can sell their participation and obtain a capital gain.

This investment is geared both to support the creation of new businesses and enhance the growth of established companies or the acquisition of shareholdings in order to ensure entrepreneurial succession. Develop investment activity the investment companies specializing in this activity, since it is an entity with some risk. There are basically two types of entities:

Venture Capital Company: A company that is devoted primarily to invest their own resources in financing SMEs temporary and minority innovative, add value in the form of management support. They do not usually have time limitadad and may increase its resources through capital increases.

Management Company Venture Capital Funds: A group of specialists with proven expertise and reputation in venture capital investments, dedicated to encouraging the establishment and management development venture capital funds of temporary duration, in exchange for a fixed amount plus a share held in the divestiture.

The will of the venture capital investor, in terms of staying in the company, raised in an environment that ranges from 3 to 10 years, since what is sought is to give the employer an alternative to financing short-term loans , staying long enough in the company to investment matures. The capitalist investment, unlike traditional stock lender or investor is not a passive partner, but who engages in business but not intervene in the daily operational processes.

One aspect that venture capital companies value most is the ability and training of the management team of the company that will participate, as well as clarity of objectives and strategy for achieving them.

Some resources for Internet entrepreneurs are:

Directorate General of SME Policy: http://www.ipyme.org

Spanish Association of Venture Capital: http://www.ascri.org

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