Informal Risk Capital Venture Capital（二）.pptVIP

Informal Risk Capital Venture Capital Financing the Business Stages for Financing Early-stage financing Seed capital Start-up financing Development-stage financing Second stage Third stage Fourth stage Acquisition-financing Traditional acquisitions Leveraged buyouts Public-equity Risk-Capital Markets Informal risk capital Venture-capital market Public equity Informal Risk Capital Markets Business angels Usually start-up Hard to calculate exact size Characteristics Industries Investment size Time frame Finding them Venture Capital Nature of Venture Capital Definition General partners Limited partners Length of investment Overview of Venture Capital 1946- American Research and Development Corporation 1958- Small Business Investment Act 1960s= 585 SBICs Today= 360 Late 1960s- Private Venture Capital Firms Today=980 Overview of Venture Capital Corporations State-sponsored Venture Capital University-sponsored Venture Capital Characteristics Size Industries Stages of business being funded Geographic location VC Process What do venture capitalists want? Basic Goal Trusting relationship with entrepreneur Business criteria Strong management team Unique Product/MKT Opportunity Good ROI Early-stage v. late-stage VC Process Portfolio establishment Four stages Preliminary Evaluate business plan Background information Agreement on principal terms Due diligence Longest stage Detail-oriented Final approval VC Process Where to find venture capitalists? Member lists Referrals Approaching venture capitalists Call to check specialization Send plan and short letter General rules Valuing the Company Eight Factors Nature and History of Venture Economy and Finances from Business Book Value and Overall Financial Conditions Future Earnings Capacity Dividend-paying Capacity Goodwill and Intangible Assets Any Previous Stock Sales Market Price of Stocks in Same Industry Ratio Analysis Liquidity Ratios Current Ratio Current Assets/ Current Liabilities Acid Test Ratio (Current Assets-In