Manufacture goods
Idea Screening
Economic Environment, growth rate, policies, new technology, financial norms & lending conditions, subsidies & incentives, socio demographic, and sectoral studies
Venture Capital
Financing involves separating technical & financial risk
Banks & FIs interest in interest & fund safety
VCs bear financial risk, participate in strategic management& monitoring control on finance to avoid time & cost overrun
VCs want to convert finance into equity and share in wealth creation
RAISING OF FUNDS …
VENTURE CAPITAL: FINANCING STEPS
First step – Seed money finance
Second step – Start-up
Third step – First round financing
Fourth step – Second round financing
Fifth step – Third round financing
Sixth step – Fourth round financing
Feasibility studies
Idea generation-screening-Is it promising?
Feasibility Analysis- Market & Technical
Financial Analysis
Economic & ecological Analysis
If worthwhile prepare funding proposal by making DPR
Techno-Economic Analysis
VENTURE CAPITAL: ORIGIN AND EVOLUTION
RAISING OF FUNDS
……
SOURCES OF VENTURE CAPITAL AND CRITERIA TO PROVIDE VENTURE FINANCE
Programme for Advancement of Commercial Technology (PACT)
Technology Development and Investment Corporation of India (TDICI)
Risk Capital and Technology Finance Corporation (RCTFC)
Venture capital scheme of IDBI
Forms of organization
Sole Proprietorship
Merits- Ease of formation, Quick action, Secrecy, Personal care, inexpensive, operation flexibility
Demerits- Limited funds, lacking specialization and managerial skills, instability
Co-operatives
Voluntary association
Democratic control
Secret motive
Contributed finance
Governmental control
Equitable disposal of surplus
Co-operatives….contd
Lack of motivation
Limited capital
Inefficient management
Lack of co-operative spirit
Partnership
Advantages- Ease of formation, quick decisions, lower risks, secrecy, pooling of abilities
Disadvantages- unlimited liability, limited resources, Instability, public confidence, non – transferable interest
Environmental factors affecting Indian organizations
International Competition- Liberalization, FERA, Rupee convertibility, excise/customs reduction, international competition
Quality standards- Fast changes in technology, ISO, trade blocs, dumping, WTO etc
Privatization- FDI, Restructuring banking
Protective mechanism- IPR, weakening of rupee trade areas
Enforcement of ecological norms- stricter enforcement of environment laws, MNCs, strategic alliances
Entrepreneurial Innovation
Product, Process, Market, Supply source, Finance, structural, cultural, personnel,
R & D, Government relations
Low innovation entrepreneurs
Chance entrant
Agent turned producer
Concession grabber
Obsessed producer
Ancillary/Imitator
Non pioneer niche holder
Idea Screening
Economic Environment, growth rate, policies, new technology, financial norms & lending conditions, subsidies & incentives, socio demographic, and sectoral studies
Venture Capital
Financing involves separating technical & financial risk
Banks & FIs interest in interest & fund safety
VCs bear financial risk, participate in strategic management& monitoring control on finance to avoid time & cost overrun
VCs want to convert finance into equity and share in wealth creation
RAISING OF FUNDS …
VENTURE CAPITAL: FINANCING STEPS
First step – Seed money finance
Second step – Start-up
Third step – First round financing
Fourth step – Second round financing
Fifth step – Third round financing
Sixth step – Fourth round financing
Feasibility studies
Idea generation-screening-Is it promising?
Feasibility Analysis- Market & Technical
Financial Analysis
Economic & ecological Analysis
If worthwhile prepare funding proposal by making DPR
Techno-Economic Analysis
VENTURE CAPITAL: ORIGIN AND EVOLUTION
RAISING OF FUNDS
……
SOURCES OF VENTURE CAPITAL AND CRITERIA TO PROVIDE VENTURE FINANCE
Programme for Advancement of Commercial Technology (PACT)
Technology Development and Investment Corporation of India (TDICI)
Risk Capital and Technology Finance Corporation (RCTFC)
Venture capital scheme of IDBI
Forms of organization
Sole Proprietorship
Merits- Ease of formation, Quick action, Secrecy, Personal care, inexpensive, operation flexibility
Demerits- Limited funds, lacking specialization and managerial skills, instability
Co-operatives
Voluntary association
Democratic control
Secret motive
Contributed finance
Governmental control
Equitable disposal of surplus
Co-operatives….contd
Lack of motivation
Limited capital
Inefficient management
Lack of co-operative spirit
Partnership
Advantages- Ease of formation, quick decisions, lower risks, secrecy, pooling of abilities
Disadvantages- unlimited liability, limited resources, Instability, public confidence, non – transferable interest
Environmental factors affecting Indian organizations
International Competition- Liberalization, FERA, Rupee convertibility, excise/customs reduction, international competition
Quality standards- Fast changes in technology, ISO, trade blocs, dumping, WTO etc
Privatization- FDI, Restructuring banking
Protective mechanism- IPR, weakening of rupee trade areas
Enforcement of ecological norms- stricter enforcement of environment laws, MNCs, strategic alliances
Entrepreneurial Innovation
Product, Process, Market, Supply source, Finance, structural, cultural, personnel,
R & D, Government relations
Low innovation entrepreneurs
Chance entrant
Agent turned producer
Concession grabber
Obsessed producer
Ancillary/Imitator
Non pioneer niche holder
