Venture Capital

http://www.integralcapital.com.au/pages/venture-capital.php?gclid=COWusuSr66cCFYtDHAodOBsCbAVenture Capital is capital invested by investors into a non-publicly listed business, in return for equity or shares in the entity. Venture Capital investors accept a higher degree of risk, as compared to banks and other financial institutions.
The term Venture Capital is often used interchangeably with the term Private Equity. Both these terms cover all possible stages of investment, whether it be seed or start up funding, funding for expansion or funding associated with an acquisition, whether that be a Management Buy In (MBI) or Management Buy Out (MBO).
Venture Capital investors are equity investors who are seeking above average returns for the risk that they may lose their capital.
Questions often on business owners minds are:-

• How would I go about obtaining venture capital funding?
• Is my company big enough?
• Should I acquire another business?
• Should I sell my business?
• Should my company go public?

These questions cannot be answered before establishing a clear strategy.
Should the strategy determine that an external investor should be brought into the business, then it is imperative that the business is made 'investor ready', in order to optimize the valuation for the business. Equally important, a list of criteria should be drawn up which clearly defines the type of investor required. Many businesses have suffered due to the involvement of an investor whose objectives were not aligned to those of the business.