All about investment

Venture capital is a type of private equity capital provided by professionals and institutional investors to promote the growth of new business ventures. Venture capital investments are on the rise in all spheres of the business community today generating a higher ROI accompanied by high risk factors as well if not carefully invested. The medical innovative friendly climate is lending a supporting hand when it comes to unfolding several opportunities of novel ideas and devices thus presenting potential investment opportunities for venture capitalists.

Once the management has a sound business plan, the need arises to raise funds for the various company activities. The best option is to finance our organization is by selling equity, stock to investors such as venture capitalists. The company's stock quote is low when it is initially starting while the cost of raising money is on the higher end for the entrepreneur, as the company is yet to prove itself. As and when the company achieves its set goals, it can generate more financial assets to support and substantiate its production, marketing, sales and customer relationship management issues which further help promoting the business to greater heights. Once the organization has proved its worth, the risk factor is drastically reduced and expansion happens on a smoother note.

According to new research by Ernst & Young/Dow Jones Venture-One Data., venture capitalists continued to favor the innovative activity of Web 2.0 companies alone last year, as $844.4 million was directed into 167 deals in 2006, with more than double the money and deals since 2005.

The benefits your organization can derive from Venture Capital Investment:
• Venture capital enhances the process of maximizing returns and minimizing risks.
• Venture capitalists seek to evaluate both the strength of an innovation and the ability of the entrepreneur to motivate commercialization in order to improve the current ROI of the organization.
• Venture capital investments supports the generation of sales and employment opportunities in the long run.
• Organizations backed by venture capital investments achieve a higher growth rate when compared to the national average business organization.
• The high tech boom of the 1990’s was the by product of venture capital investment.
• It is one of the main factors which support the US global competitive strategies.

Venture capital investment backed companies in the US alone generated $1.3 trillion in sales and provided employment to 10 million workers, in 2003. Today the statistics have grown by leaps and bounds. Venture capital investment has proved to be most beneficial for all involved. The most vital contribution of venture capital investment has proved to be the support and economic guidance it provides to the rapidly growing business organizations.