VENTURE CAPITAL - AN INSPIRATION .WHY?

PROF. K. R. PRABHU
DEAN
PREAMBLE: Economic activity is a must to full-fill the needs and
possible needs of humanity. It is the foundation on which the
National Economy stands. Creativity and business skills are
essential to become an Entrepreneur. It is ultimately the business
entrepreneurs whether private or public are responsible to meet
our needs on one hand and generate the revenues to the state
nationally or internationally held transactions.
In todays STARTUPs or VENTURES are of Global status with
upgraded technologies or upgraded systems require higher
magnitude of finance to produce higher scales of output both in
production sector as well as in service sector.
Venture Capital companies are becoming more and more
important and they are prospered than the normal financing
agencies like Development banks, Investment Corporations,
commercial banks etc.
ENTREPRENUERS AS A COMMUNITY: Technocrats, people with
experience in the relevant fields are more ambitious to become
owners than employees. They get the full knowledge of the
business in different angles. We find that traditional business
houses and family business startups are having many positive
points to get the Investment partner like Venture Capital easily.
Today, there is a different kind of Entrepreneur Community is
coming up. They are qualified, having track record in the field that
venture. They have strong business plan projections. Strong data
back up and the courage to venture. Professional community like
Engineers, Doctors, Chartered Accountants, Scientists, and
Practicing Managers from industry/service segments are planning
STARTUPs in a mushroom manner. All of them are going ahead
with the support of VENTURE CAPITALS.
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VENTURE CAPITAL A FINANCIAL PARTNER: Venture Capital

or Venture Capital Companies are Business Partners be it a
Partnership firm or joint stock company. They take more business
risk and invest more than the Promoter. Venture Capital company
holds equity shares may join as an active partner or not. Most of
the time they represent on the Board of Management to safe
guard the entire investment. A Venture Capital Company is a
good advisor on finance and navigates the future plans of the
company as a partner with promoter (Entrepreneur) as the former
is more exposed to the international business trends. A Venture
Capital Company overcomes the negative effect of relative or
friend as partner. Pure professional management runs the unit.
In the event of requiring more equity support, that becomes more
easy than going to funding agencies formalities which either time
consuming and the chances of leakage of plans as the same is
moving in the hands of many. If profits are there, the Venture
Capital Company gets as much as the promoter. If there are
losses, both the Venture Capital Company and promoter have to
bear. Hence there is complete transparency in the deal.
FUTURE TRENDS:In India with the new policy of the Government
to make India as MAKE IN INDIA, with the sole idea of converting
India into an Export hub to the world, a new environment is
created to promote more and more Entrepreneurs to enter the
fray. Foreign business Export & Imports get strengthened. The
formula is simple Export more than Import.
International
Venture Capital Companies are forming a Q to fund the projects.
Commercial Banks, Investment Banks, Development Banks have
to lose a big slice to Venture Capital which is more compatible,
fast in processing . Promoting Entrepreneurs are negotiating with
the Venture Capital companies.
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In total, we have to know that Venture Capital Companies are

more shrewd to select and negotiate their terms. They have high
confidence on the project and they are sure that Export Import
will build the business prospects either in their own country or
elsewhere. The share values are going at higher rates in Stock
Exchanges because of the high profits in the operation. A venture
capital will either continue or comeback by selling their stake
even at lower rates of Stock Exchange and reinvest in other
Ventures. Hence, Venture Capital Companies are a barometer for
the performance of a business entity in product/service sector.
Whatever is said and done, an Entrepreneur gets Venture Capital,
he runs less risk in servicing the large equities. It is an Equity
Capital that a Venture Capital Company brings which safe guards
the unit from day one from risk.
According to Times of India, the foreign active Venture Capital
Companies entered into Indian Startups are, 2010 49, 2011 89,
2012 113, 2013 164, 2014 222, by April 2015 125. (PAYTM
- $585M, OLA - $400M, QUIKR - $150M, SJP[C;IES -$100M.
FREECJARGE - $80M
crossing $2.36 billion by April alone.
Whereas the Merger & Acquisition zoomed to 7 times in 34 deals
compared to 5 in the last year.
CONCLUSION: In todays business environment Venture Capital
as a business is growing rapidly and becomes visible along with
new STARTUPs. Employees have become Employers. Creativity,
Innovation, Technological up gradation, business system in every
aspect of management for HR to Supply Chain is getting more
energized because people have aware that TIME IS MONEY.
Internet business is more visible today than in the past. We play
with higher volumes and cheaper to the customers and
consumers. It is a vicious circle and that makes the wheels of
industry and business move, satisfying all stake holders. Govt higher revenues, better balance of payment, employees higher
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pay packets & incentives, consumers better product at relatively

cheaper rate , management higher rates of return, banker
prospective top-lines. Nation higher position on the business
scales. Thus, Startups and Venture Capital are thetwo faces
of the same coin in todays world.
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MESSAGE FROM CEOs DESK

Dear Patrons, Dean, Members of faculty and students,

I am highly indebted to my class-mates for unanimously selecting
my candidature for the position of CEO ship of S & M Journal an
unique opportunity for me to present this journal. I am more
indebted to Dear Sirs and other staff members to help me in
selecting the subject VENTURE CAPITAL - a hot subject of the
day for this Journal.
My team members and my self visited a number of companies,
professionals and individuals who placed their appreciation on the
subject Selected by us as VENTURE CAPITAL which has a logical
relation to the subject STARTUPs - These two subjects are the
two faces of the same coin in - in todays Business World.

I once again thank all for their contributing interms of time,

effort
and guidance, to make this Journal
placed in your
esteemed hands.
Regards
(T. AJAY)
CEO