Advances in Economics, Management and Political Sciences
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Proceedings of the 2023 International Conference on Management Research and Economic Development
Series Vol. 25 , 13 September 2023
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Venture Capital Investment Success: A Study of the Factors that Matter
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Abstract
Venture capital funding is essential for emerging businesses because it allows them to gain access to capital and other resources necessary for growth. VC firms play an important role in economic growth because they inspire innovative thinking and provide funding for startups to develop marketable products and cutting-edge technologies. Consequently, it is essential for venture capitalists to take into consideration relevant aspects before investing in order to increase the proportion of investments that are successful. Through literature analysis which has revealed that there are six key components to a successful venture capital firm: the team, the syndication, the valuation, the value-add, the interaction with investors, and the exits. Importantly, venture capitalists place more weight on the selection of transactions than on the selection of investments. Rather than considering a company's track record or product offerings, investors will place greater emphasis on the management team behind the venture. Many venture investors subscribe to the old adage that investing in a mediocre idea with excellent management is better than a fantastic business strategy with inexperienced management because a team with competent and experienced employees will play a significant part in the firm's growth. Even while it's crucial to choose your transactions carefully, value can also be created by the addition of new elements after an investment has been made.
Keywords
venture capitalists, management team, startup valuation
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Data Availability
The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.
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- Volume Title
- Proceedings of the 2023 International Conference on Management Research and Economic Development
- ISBN (Print)
- 978-1-915371-93-5
- ISBN (Online)
- 978-1-915371-94-2
- Published Date
- 13 September 2023
- Series
- Advances in Economics, Management and Political Sciences
- ISSN (Print)
- 2754-1169
- ISSN (Online)
- 2754-1177
- DOI
- 10.54254/2754-1169/25/20230476
- Copyright
- 13 September 2023
- Open Access
- This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited