Will I own money to a venture capital firm?

Anthony M asked:

I’m not too sure of how VC really works. Let’s say I am a startup company and we get founded by VC. They invest in the company and get a share of it, I pay some annual fees, and if everything rolls alright we get to split the money in the end after an acquisition or IPO.

But what happens if the product fails? Will I own any invested money to the VC firm? How does it work?
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Filed Under Small Business | 2 Comments

need financial information regarding venture capital?

pappu asked:

i am presenting a paper in an international workshop. i have to present thepaper with some research models or some research work done.

i want to do it in venture capital and i need financial details regarding the topic with reference to indian companies.

can anyone help me out in this regard.

Thanks
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Filed Under Corporations | 1 Comment

Are banks and interest really needed?

Anders asked:

If I buy a house, then I can take a loan, from a bank, with the obligation to pay back the loan at a certain minimum amount per month or year, with zero interest. Why is the interest needed other than to keep the bank going? I could take the loan directly from the government, and no bank is then really necessary.

Then what about if a company wanted to take a huge loan? The answer is: they will have to get money from venture capital companies, and the agreement they make is a deal between the company that wants the loan and the venture capital company that provides the money. No banks needed.

The same with other services banks provide. They could be done by ordinary companies.

I understand that in practice, banks are deeply integrated into society. But in theory, are banks and interest really needed? Would it be possible to have a totally interest-free economy?
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Filed Under Other - Business & Finance | 3 Comments

Is Obama’s attack on venture capital a necessary consumer protection or another opportunistic power grab?

Martin L asked:


Please read the article before answering:

http://online.wsj.com/article/SB12392364…

Exerpt from the article quoting Tim Geithner, speaking on behalf of the administration, trying to justify the new draconian regulations:

“In justifying new SEC registration requirements, Mr. Geithner said that Bernie Madoff’s Ponzi scheme demonstrated that investors need more protection. He didn’t mention that Madoff’s firm was registered with the SEC as an investment adviser and had also been regulated by the SEC for decades as a broker-dealer. Also, Madoff was not running a venture firm.”

Does Geithner know what he’s doing?

If not, we should all be afraid that he (and Obama) is in over his head.

If so, we should all be afraid that they are not interested in a thriving private sector.

Another excerpt:

Says Cypress Semiconductor CEO T.J. Rodgers, “First, Sarbanes-Oxley mandated byzantine corporate bureaucracy to ‘protect’ investors. Then, the SEC damaged the Silicon Valley economy by forcing companies to count stock options twice, both as dilution and as expense. As a result, Silicon Valley, for decades the bright spot of the American economy, produced only one [initial public offering] in all of 2008. Now, Geithner wants to regulate venture capital firms to protect us some more. It’s like watching children deface an economic work of art.”

Filed Under Other - Politics & Government | 2 Comments

Can you buy stok back and become a private company if you sold shares for money to a VC?

gay-pianist asked:


Venture capital fund you sell them shares can you agree to buy them back? DOES THIS EVER HAPPEN? If so give examples.

Filed Under Investing | 1 Comment

How do you start looking for Venture Capital Funding?

ebusinessconsultingus asked:


For an online company, located in a small rural area, that has been in business for over 5 years, how does one go about attracting venture capital funds and investors?

Filed Under Small Business | 2 Comments

What type of returns do venture capital firms expect to receive from their initial investment?

justin k asked:


I am starting a company and I am preparing to seek funding from venture capital firms.

Filed Under Small Business | 2 Comments

Startup & Venture Capital - Are ideas worth anything?

zerohourx asked:


I’m considering a new internet startup venture and have some questions about VC funding.

At the moment I just have a 50 page document outlining the idea, marketing strategy, competition, and such (it could be considered a very “informal”, “non-technical” business plan) but not one line of code for the new service. As outlined in the document, the service does make use of an approach I’ve submitted a Provisional Patent for.

My question is, can one successfully pitch an idea to VCs in order to get funding to begin making the company? Or is it a REQUIREMENT to have a “traditional” business plan, a competent team, and the existing web service with actual end-users using it. Perhaps a mockup demo could suffice?

If the idea-no-code approach, mentioned above, is possible, what kind of % share would the creator be entitled to? Sure I brought the idea but in all fareness, the VC had to flip the bill for all the developers and time to make the site from scratch.

Thanks!
I’ve heard many horror stories of going the VC route but I’m at a point where I’m about to explode with frustration unless I get things rolling, even if that means less control.

Perhaps there are startup support services out there which make it easier to build the company from scratch rather than the proclaimed painful approach to VC? I live in Ontario Canada but like so many my eyes are set on Silicon Valley only because that seems to be where all the action and VCs are. I can’t imagine it mattering where I start up the company considering it is internet based.

Filed Under Investing | 1 Comment

What are some unorthodox methods for borrowing money to start a business?

JB asked:


Don’t waste your time or mine by answering with “borrow from family” or “go to your bank”, etc.

I have a few ideas for businesses that I would like to start, but it seems like every avenue I explore to borrow money turns out to be a dead end. Forget about borrowing from banks and family. What are some less than common borrowing methods I can consider? I checked with the SBA, they no longer lend money, and the only grants they can assist you in getting seem to be for environmental causes. I checked into numerous venture capital companies, but they all seem to be interested only in information technology ventures. I’ve considered forming a private corporation and selling stock in it to private investors, but I don’t know if I’d be able to find enough investors. Also, I’m afraid I’d the investors would be breathing down my neck all the time and trying to tell me how to run the corporation. Anyone have any worthwhile thoughts on all of this?
I am not interested in prosper.com. Please refrain from answering with referral links to this or anything else. Anything that you’ll profit from if I sign up, I’m not interested, so don’t waste your time or mine. Thank you.
No more answers like the one from the ignorant dolt who posted the 3rd answer below. “I know someone who was helped by this lender, or I was helped by so and so, or I’ll lend you the money - I’m an accredited lender”. You people know who you are. Rather, I should say, you SCAMMERS and CON ARTISTS know who you are, and I see right through you, so don’t waste your time, or what is infinitely more important, MINE.

Filed Under Personal Finance | 2 Comments

What are some jobs available to those wanting to enter the venture capital world?

fisikia asked:


BS Physics, MS Electrical Engineering

How can I get a job in a NY venture capital / financial firm?

Ultimately I’d like to find tech companies to invest in and be involved in start-ups.

Filed Under Other - Business & Finance | 1 Comment

Looking for venture capital for the entertainment industry, internet and film. Advice please?

Ken I asked:


Asian production company is looking to establish a new office in S.E. Asia. Focal point being film production and internet delivery of some content. The parent company of this venture is an established, well known production group in the U.S and Australia.

Filed Under Other - Business & Finance | 1 Comment

Does CS bank hold venture capital fund?

Torino chocolate asked:


Does Credit Suisse group bank (CS) hold one or more of the following: private equities, venture capital funds, or holding companies ?
If so, which, and how are they called?

Filed Under Investing | 1 Comment

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