small business in section one. Than, venture capital is viewed as a box of services which are also important as the very capital provided is. Moreover, this is acknowledged as a main contributor toward the firm’s professionalization. Finally, in the last part, certain space is devoted to the less attractive side of the venture capital.
2 Why small start-up firms (must) choose venture capital financing? Venture capital primary role
Even though the process of brainstorming could be really productive and endless, entrepreneurs must often think about the financial side of their idea. Indeed, one could have brilliant idea for starting up a smart business, but launching that idea needs fuel – this makes him troubles. Therefore, such “poor” entrepreneurs must rely on external financing in order to start their business (Lulfesmann, 2000). Indeed, young, especially innovative and fast growing businesses find it very difficult the access to traditional ways of financing (Gompers and Lerner, 1999; cited in Giudici and Paleari, 2000). The latter is due to the fact that these start-up firms are too small to be fed by public debt and equity markets, than, because of their infancy, they can not collateralise eventually offered bank loans (Repullo and Suarez, 1998) and they are associated with a “significant levels of business uncertainty” (Giudici and Paleari, 2000, p.154), arising from the persistent information asymmetries and high risk associated with the opportunity to cease. But, this does not mean that the majority of innovative ideas must go away. A brilliant chance arises for such cases – venture capital.
温湿度传感器原理及使用方法 “Venture capital is thought to be an important alternative for companies that have difficulties accessing more traditional financing sources” (Manigart et al, 2002, p.103-104) and it (venture capital) is a strong financial injection for early-stage companies that do not have evidence for persistent profitability yet (Kleberg, 1998). In other words, venture capital is needed to trigger, maintain and to speed up the small enterprise’s growth and its performance, and therefore to result in improved profitability. That is its primary role: it is the main contributor in getting rid of the most financial impediments that occur in the establishing phase of a new business. (Reynolds, 2000). In other words, it is “seed money” for the small business; it helps smart ideas to rise up. However, on the other hand, venture capital financing is associated with high levels of risk, which refers to the uncertainty of the positive returns that may occur even after a number of years or never (Mason and Harrison, 2004; Klofsten et al, 1999). Not only this, but venture capitalist may also embark on a new business strategy which defers from entrepreneur’s one; the former can even throw the entrepreneur out of the firm. These aspects are discussed later.
What is sure, once it has been agreed, venture capital flows in the company and enables its start-up. This is the point when the idea becomes reality. But, not only providing the capital, venture capital injection brings more benefits for the venture-backed company than one could think of. Manigart and Sapienza (1999; cited in Manigart et al, 2002) point out “its roles of pre-investment screening, post-investment monitoring and value-adding” (p.104). Critically said, venture capitalist becomes active entrepreneur’s mentor, because, from now on, firm’s destiny turns out to be his concern
上一页 [1] [2] [3] [4] [5] [6] [7] [8] [9] 下一页
风险投资融资英文文献和翻译 第2页下载如图片无法显示或论文不完整，请联系qq752018766
