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Venture Capital

Our Corporate Services has the potential to provide effective capital for the growth of your company.

Whilst it can be an excellent source of financing for the right business, it is certainly worth bearing in mind that it may not be suitable in all instances. Still, should a business be in real need of cold, hard capital funding, it can provide an invaluable boost.

The decision to seek this type of financing must be preceded by a dispassionate assessment of the ability of your business to deliver what the investors providing this type of finance will be looking to achieve.

In a nutshell, the primary aim of venture capital investors is to realize a large profit from investment in your company. This means that they usually enforce rigid criteria and insist that you satisfy this before they release funds.

In our experience, the criteria of the majority of venture capitalists tend to focus on the following:

  • Does your organization produce or market a new, unique product or service that is likely to appeal to a large demographic?
  • Will your newly-funded business be in a position to seriously compete with the leading companies in your chosen market?
  • Is the nominal funding requirement in the region of $500,000 or $5 million or above? Will this facilitate the ordinary operation of the business and be sufficient to bring the product or service to market ?
  • How easy will it be to get your market demographic to notice your unique product or service?
  • Is the product or service likely to require intensive customer support?
  • Will your product or service produce gross margins in excess of 50%?
  • Do you and/or your management team possess intimate knowledge and understanding of the new product or service? Do they have previous successful business experience?
  • Is your business realistically capable of achieving gross annual revenues of $25 million within 3 years of drawdown of the requested venture capital funding?

The ability to answer with a resounding “yes” to the final question is of paramount importance to venture capital investors. They will want to achieve substantial return on invest on investment and the prospect of a shortfall in this area will be unpalatable to them. If you are unsure whether your business can meet this proviso, it would be advisable to seek other options like small business funding.

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