Q.Explain about Venture Fund institutions.

Venture fund institutions supply risk (equity) capital and guidance to new, innovative, high-risk ventures in return for a stake in them.

Venture fund (venture capital) institutions are a special part of the capital market that finance enterprises which are too new or too risky to obtain funds from ordinary sources such as banks. Their main points are:

• Nature of finance: they provide long-term risk capital, usually as equity participation (buying shares) rather than loans, so they share in both the risk and the reward of the business.
• Target ventures: they fund new, small, high-technology and innovative enterprises with strong growth potential but no established track record.
• Managerial support: besides money, they often offer technical, managerial and marketing guidance to help the venture succeed. …