Venture Capital – A New Framework

Abstract

The best way to expand a business is when the customers are funding expansion. However, most businesses need additional capital at times. They may need it in the early and risky stages of a startup or to bridge resources to meet specific needs. Venture Capital is the essential resource for growth of an enterprise, and also gives the venture the resilience to face adverse times in its life cycle. One can see role of capital throughout the continuum of an enterprise: it is essential for survival and pivotal for growth in the beginning, and expansion thereafter.

In this chapter, we discuss the drivers and need of – optimal amount to be easily accessible and infused through most appropriate mechanisms – to bridge resources to meet growth needs with a view to industrialize innovation across the land. The right amount of capital, infused at the right time, at right terms and conditions, with realistic expectations to grow a business, creates tremendous value for all. Capital managed expertly, delivers superior ROI for investors as well. There must a be balance between the risk and reward for the capital that drives positive impact. We propose the use of expert risk-reduction prior to strong investment that changes the model and efficiency of Venture Capital.