Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Resource Mobilisation

Question:
Which of the following is a feature of Venture Capital?
Options:
It is basically equity finance in relatively new companies.
It is long-term investment in growth-oriented small or medium firms.
Venture capitalist not only provide capital but also business skills to investee firms.
All of the above
Correct Answer:
All of the above
Explanation:
Thus, venture capital finance has the following features:
1) It is basically equity finance in relatively new companies.
2) It is long-term investment in growth-oriented small or medium firms.
3) Venture capitalist not only provide capital but also business skills to investee firms.
4) It involves high risk-return spectrum.
5) It is a subset of private equity.
6) The venture capital institutions have a continuous involvement in the business after making the investment.
7) Such institutions disinvest the holdings either to the promoters or in the market.