scholarly journals Empirical Analysis of Hungarian Firms According to Venture Capital Investment Criteria

2016 ◽  
Vol 9 (1) ◽  
pp. 16-32
Author(s):  
Judit Edit Futó
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Selection Process ◽  
Statistical Tests ◽  
Venture Capitalists ◽  
Venture Capital Investment ◽  
Capital Financing ◽  
Venture Capital Firms ◽  
Investment Process ◽  
Index Investment

Abstract Over the past decade the venture capital industry has become more and more prominent, not just on a global level, but in Hungary, too. Thanks to the JEREMIE Program a large number of new venture capital firms are located in our country, and therefore an investment wave has started. The aim of the paper is to sort micro- and small sized enterprises in terms of how appropriate is a venture capital financing. The main topic of the paper relates to the selection of firms for venture capital investment; therefore, in the first part of the study we briefly summarize a general venture capital investment process, highlighting both the selection process and the criteria used for selection. Then we propose 3 indexes (trustworthiness index, openness index, investment index), which we have created to help venture capitalists to decide whether the targeted enterprises are appropriate for them, or not. In the main part of the paper we provide a classification of micro- and small sized Hungarian firms based on my own survey, and we analyze what kind of relationship exists between the proposed indexes and the type of the classified firms. The result of the classification is that we identify four main firm types and, based on statistical tests, it can be said that there is no significant relationship between the trustworthiness index and the clusters, but that there are between the two other indexes and the clusters.

scholarly journals Impact of Venture Capital Investment Syndication on Enterprise Lifecycle and Success

2016 ◽  
Vol 8 (5) ◽  
pp. 75 ◽  
Author(s):  
Asif Siddiqui ◽  
Dora Marinova ◽  
Amzad Hossain
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Survival Duration ◽  
Venture Capitalists ◽  
Venture Capital Investment ◽  
Investment Theory ◽  
Capital Financing ◽  
History Of ◽  
Investment Growth ◽  
The Impact

The article investigates the impact of venture capital investment and investment syndication on enterprise lifecycle and success using the exit history of venture capital backed companies in Australia. It is observed that the venture capital backed companies tend to outperform those which are not while companies receiving syndicated venture capital investment tend to outperform the other venture capital backed companies. Based on the classic venture capital investment theory, we argue that venture capitalists essentially engage in superior venture selection through pre-investment screening and contribute to entrepreneurial development through post-investment monitoring and value creation. We then empirically investigate the lifecycle of the Australian venture capital backed companies from company formation to first venture capital financing round to exit. Survival duration of the ventures, investment growth and exit status are specifically analysed to capture the lifecycle. The findings show that the survival duration prior and post venture capital investment, venture capital investment growth in successive rounds and investment syndication increase the probably of success for the ventures.

Pulse and Progress of Venture Capital Financing in India: An Analytical Study

Think India ◽  
2019 ◽  
Vol 22 (3) ◽  
pp. 553-562
Author(s):  
Dr. Devarajappa S
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Analytical Study ◽  
Economic Empowerment ◽  
Statistical Tools ◽  
Venture Capital Investment ◽  
Secondary Sources ◽  
Current Trends ◽  
Capital Financing ◽  
Secondary Information

The Main objective of the paper is to examine the current trends and progress of the venture capital in India and the paper also highlights the concept and stages of financing of venture capital. To meet the aim objective of the study the researcher used secondary sources. The required secondary information has been collected through various articles, reports, magazines’ and websites. To examine the trends of venture capital in India, IVCA (Indian Venture Capital Association) report is used.  For the purpose of examine the data; the statistical tools like Mean, Standard Deviation, Charts and ANOVA, Correlation coefficient have been employed.   The study concludes that, the venture capital investment has been increasing in India and this is the positive indication for the country, to curb the unemployment, economic empowerment of people through maximizing startups in India

THE MANAGEMENT OF VENTURE CAPITAL AS A TYPE OF FINANCIAL RESOURCES: GOALS & OBJECTIVES

2021 ◽  
pp. 174-191
Author(s):  
Tetyana Demchenko ◽  
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
World Market ◽  
Real Sector ◽  
Venture Capital Investment ◽  
Venture Investment ◽  
The World ◽  
Capital Financing ◽  
The One ◽  
Venture Business

In the context of Ukraine’s integration into the world market, there is a growing interest in creating a control system for all stages of venture capital activities. The mechanism of effective management of venture activities of an enterprise should become a tool for establishing this system. The system of information flows is of great importance, which provides information to the process of making management decisions on a risky innovative project at a venture capital enterprise. The purpose of the venture business is to make a profit on the invested funds [1]. Unlike simple investment, venture capital is the most risky form of capital investment. However, if the project is successful, venture capital investment is the most profitable. Venture investment is, on the one hand, a way of financing the innovative vector of the economy, on the other, an innovative form of entrepreneurship. The main goal of venture capital financing is that the monetary capital of some entrepreneurs and the intellectual capabilities of others (original ideas or technologies) are combined in the real sector of the economy in order to bring profit to both types of entrepreneurship in a new company.

scholarly journals The Role of Founder-CEO, Human Capital and Legitimacy in Venture Capital Financing in China’s P2P Lending Industry

2021 ◽  
Vol 13 (4) ◽  
pp. 1625
Author(s):  
Hui Zheng ◽  
Xuexu Piao ◽  
Sangmoon Park
Keyword(s):  
Human Capital ◽  
Venture Capital ◽  
Capital Investment ◽  
New Ventures ◽  
Third Party ◽  
New Venture ◽  
Venture Capital Investment ◽  
Capital Financing ◽  
P2p Lending ◽  
Industry Experience

The paper investigates factors to financing from venture capital (VC) in the Peer to Peer (P2P) lending industry of China. We focus on the signal effects of founder-CEOs, human capital, and legitimacy on venture capital investment. An important issue for entrepreneurship research is how to reduce t information asymmetry between entrepreneurs and potential investors. This paper builds on the signal theory to explain how new ventures can signal their qualities and promising businesses to potential investors to obtain external investment. By using a total of 2388 new ventures in China’s P2P lending industry, this paper analyzed the effects of factors on VC investment. We found that the founder-CEO status and the legitimacy of third-party signals are crucial to obtain the support of venture capital. We found that the CEO’s international experience has positively significant on VC financing, but the industry experience of CEOs is insignificant to get VC investment. The results indicate that new venture should pay more attention to build the ways of signaling and legitimacy of new venture to get external resource providers.

scholarly journals Commitment to capital raising for venture capital funds in India: An Application of ARDL Model

2021 ◽  
Vol 13 (2) ◽  
pp. 121-133
Author(s):  
MOHAMMAD MUSTAFA ◽  
◽  
SYED SHAHID MAZHAR ◽  
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Critical Role ◽  
Primary Source ◽  
Market Liquidity ◽  
Venture Capitalists ◽  
Venture Capital Investment ◽  
Distributed Lag ◽  
Interest Rate Spread ◽  
Macro Variables

Venture capitalists (VCs) áourish on the ability to add funds to their kitty across nations. Consequently, VCsíability to convince Limited Partners (LP), who are their primary source of Önancing, plays a critical role in the venture capital investment growth in any economy. However, it is not easy to rake in capital from an investor. LPs assess the market conditions carefully before making their capital available to the VCs. This paper examines the macro-economic variables that ináuence the supply of money to venture capital funds in emerging economies such as India from an LPs perspective. The empirical analysis using Autoregressive-Distributed Lag (ARDL) approach reveals that supply of capital to the VC funds in India is ináuenced by macro variables as well as past investment behaviours. Macro-variables such as GDP growth, interest rate spread, global liquidity, and ináation rate signiÖcantly ináuence the supply of capital to the VC funds in India. However, stock market liquidity does not ináuence the supply side of the venture capital investment. Our analysis reveals that VCsífund raising in India is highly ináuenced by their past investment relation with the LPs.

scholarly journals Entrepreneurial Passion and Venture Capitalists’ Willingness to Invest: The Role of Relational Capital

2021 ◽  
Vol 12 ◽  
Author(s):  
Hongtao Yang ◽  
Hangyu Shi ◽  
Yenchun Jim Wu ◽  
Lei Zhang ◽  
Shuting Xie
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Conflicts Of Interest ◽  
Positive Impact ◽  
Relational Capital ◽  
Venture Capitalists ◽  
Venture Capital Investment ◽  
Entrepreneurial Passion ◽  
The Relationship

Venture capital investment has serious conflicts of interest and information asymmetry. Venture capitalists often make investment decisions on the basis of the passion of entrepreneurs, including enthusiasm and preparedness, in the process of interacting with them. Most of the previous research on relational capital have focused on the cooperative relationship between suppliers and buyers. However, the role of relational capital in the process of partnership between venture capitalists and entrepreneurs has not been revealed. On the basis of signaling theory, we explore the relationship between entrepreneurial passion and venture capitalists’ willingness to invest. We also examine the mediating and moderating roles of relational capital. This study takes 79 projects between venture capitalists and entrepreneurs as samples for empirical analysis to verify our hypothesis. Results show that entrepreneurs’ enthusiasm and preparedness have a significant positive impact on venture capitalists’ willingness to invest. Relational capital plays a mediating role between entrepreneurial passion and venture capitalists’ willingness to invest. Relational capital positively moderates the relationship between preparedness and venture capitalists’ willingness to invest but has no moderating effect between enthusiasm and venture capitalists’ willingness to invest. Results deepen the understanding of the relationship between entrepreneurs’ passion and venture capitalists’ willingness to invest, which has guiding significance for venture capital practice in China.

Patterns of Preference for Venture Capital Investment in the United States of America, 1970–85

1989 ◽  
Vol 7 (2) ◽  
pp. 205-222 ◽  
Author(s):  
M B Green
Keyword(s):  
Venture Capital ◽  
Capital Investment ◽  
Local Development ◽  
The United States ◽  
Venture Capital Investment ◽  
Median Polish ◽  
Venture Capital Firms ◽  
High Level ◽  
Industry Choice ◽  
Privately Owned

In this paper a model of the spatial development of the American venture capital industry is provided. The investment preferences for both publicly and privately owned venture capital firms for the period 1970–85 are examined in light of this model. A median polish analysis of the investment preferences, for firms located in the sixteen largest venture capital centers, reveals a high level of regional parochialism in investment. Differences in risk aversion and industry choice are also found both by city type and by firm type. Implications for local development are discussed.

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