A Reality Check for Venture Capital Seekers
Venture Capital comes in many forms, but shares a common characteristic: a risk is taken. While trying to look for sponsorship, one has to run against many “Checks”, however genuine, fantastic idea or good the business plan may sound.
According to the available data, among those who present their proposals for funding, only one or two percent gets funded. One of the reasons is the market itself: banks are not lending, the secondary market is non-existent such that all that is left is money from private equity.
All projects that are predictably profitable and will give the investor a good return on their investments gets funded first. Other great projects that may get funding are projects where there is proprietary or patented technology.
Calculated Internal Rate of Return is also used to determine who gets funding first, all these factors are not only limiting but also a great check against progress.
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