Sino Corp CPA Limited

Venture Capital ("VC") is also called venture fund. Nowadays, Venture Capital has shifted its orientation from traditional industry to high and new-tech business creation, while high and new-tech field is an important way to gain high investment return.

Characteristics of Venture Capital

Object of Investment : Medium or small-sized enterprises in stage of business creation, and mostly being high and new-technology enterprises
Term of Investment : 3-5 years or over, generally by means of equity investment, which usually accounts for 15-30% equity interests in the invested enterprise, without requirement for control power
Decision of Investment : On the basis of expert assessment and evaluation
Relation of Investment : Investment company will proactively take part in the operation and management of the invested enterprise, and provide value-added service
Strategy of Investment : To determine the manner, scale and other aspects of investment according to different development stages of the invested enterprise (i.e. seedling stage, creation stage, growth stage, expansion stage, maturation stage), for the purpose of reducing investment risk
Return on Investment : It is not aimed to procure investment bonus, but to withdraw investment by means of listing, acquisition, merger invested enterprise or other equity transfer

Manners of Venture Capital

Investment directly in the invested enterprise by installments
Procurement of bank loans through Venture Capital Company security
Partly loans on security and partly direct investment

Standards of Venture Capital

It has potential market
Science and technology is specific to market demand
It can set up market advantage
It can become market leader
Its management has talents and foresights
It has significant return

Steps to draw Venture Capital

To familiar with corporate finance process
To show corporate value
To prepare business prospectus
To promote enterprise
Evaluation and due diligence
Transaction negotiation
To sign agreement