Most of the funds of venture capital companies are used to invest in new enterprises or unlisted enterprises, instead of operating the invested company. Only by providing funds and professional knowledge and experience can the invested company obtain greater profits. Therefore, it is a high-risk and high-return enterprise pursuing long-term profits.
Venture capital has many investment terms. Be sure to think clearly when you take the money. Gambling agreement, priority liquidation right, whether one vote is completed or not, funds need to reach different stages in batches, priority dividend distribution right, and change management right. . . At the same time, venture capital will bring a series of added value to enterprises. The choice of venture capital must depend on its advantages and disadvantages. Some venture capitalists do not have particularly strong resources (or resources cannot be effectively transformed), but the investment conditions are very harsh. After getting the money, the project will be under great pressure and constraints, and will eventually be abandoned. Some conditions are harsh, but relatively reasonable. In addition to the fact that money can really empower enterprises, the project itself needs to be carefully evaluated.
When entrepreneurs are looking for sources of venture capital, it is necessary to examine the qualifications of venture capital companies. We should not only understand the background, investment preferences, investment standards and venture capitalists of venture capital companies, but also understand their past investment experience, analyze the reasons for their success or failure, and understand the relationship between venture capital companies and investment banks. Entrepreneurs can obtain information about investment companies from the Securities and Exchange Commission, industry research institutions and companies invested by companies.