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Global Venture Capital Funds

Fueling Tomorrow's Innovations Today.

Global Venture Capital Funds are specialized investment funds
that focus on investing in high-growth startups and innovative
companies in their early stages. These investments are
pivotal in driving the growth of next-generation businesses,
offering the potential for high returns while
shaping the future of technology and industry.

KYI: Know Your Investment

What do Global Venture Capital Funds do?

Global Venture Capital Funds are investment funds that provide
capital to startups and small businesses with long-term
growth potential. These funds not only offer financial
support but often bring valuable expertise, mentorship,
and access to networks, playing a critical role in the
development of new companies.

Why Invest in Global Venture Capital Funds?

Investing in Global Venture Capital Funds offers the opportunity to
be part of cutting-edge innovations and market-disrupting
companies. It allows investors to diversify their portfolios
with potential high-return assets while contributing to the
entrepreneurial ecosystem. These funds target emerging
sectors and technologies, often leading to substantial
financial and strategic returns.

22.7%

Median net IRR for global venture capital funds with a 2009-2019 vintage.

$530.8bn

Global venture capital dry powder in September 2022.

73%

Of aggregate capital raised has gone to experienced venture fund managers that are on fund or above.

88%

Of global venture capital IPO exits aggregate deal value was from the Greater China region in the first nine months of 2022.

$73.4bn

Fundraised by early-stage strategies globally for the year to Q3 2022, higher than any other venture capital strategy.

5,048

Funds in market as of September 2022, targeting $400bn.

High Growth Potential: Access to startups and emerging companies with significant growth prospects.
Portfolio Diversification: Opportunity to diversify investment portfolios beyond traditional asset classes.
Innovative Exposure: Direct exposure to innovative technologies and business models.
Strategic Returns: Potential for high financial returns along with strategic insights into emerging industries and trends.
Supporting Entrepreneurship: Contributing to the growth of new businesses and the broader economic ecosystem.

High Risk of Failure: Early-stage companies have a higher likelihood of failure, posing significant investment risks.
Illiquidity: Investments in startups are typically illiquid with no immediate returns or short-term exit options.
Market Volatility: Startups are often susceptible to market fluctuations and economic downturns.
Long-Term Commitment: Venture capital investments usually require a long-term horizon without immediate financial gain.
Limited Information: Limited access to detailed historical data and financials for early-stage companies makes risk assessment challenging.

Learn More

Venture Capital Funds (VCFs) globally are defined as specialized investment funds that provide capital to start-up companies and small businesses with perceived long-term growth potential. These funds are typically comprised of institutional and high-net-worth investors. VCFs are known for taking higher risks in exchange for the potential of higher returns. They often involve active participation in the invested company, providing strategic, operational, and financial guidance. The goal of venture capital is not only to provide financial backing but also to add value through expertise and industry connections, thus fostering innovation and growth in early-stage or high-growth companies.

VCF pool in funds from the prospective investors wanting to make equity investments in different/ multiple ventures, depending on their business plans, profiles, and development phases. Once the investors commit, the VCF finalizes the investment amounts of each potential investor to collect the capital. Then the fund manager (VCF) sought out private equity investments with a high growth potential that have the best chances of giving investors a return.

Based on the fund utilization in different phases of a business, Venture Capital Funds are classified into three broad categories. Early-stage financing, Expansion financing, and Acquisition/Buyout financing.

Early-Stage Financing: There are 3 sub-categories in early-stage financing. These are Seed Financing, Startup Financing, and First Stage Financing. Seed financing is a small sum given to the entrepreneur to serve the purpose of qualifying for a startup loan. When early-stage companies receive funds to complete their services and product developments, it is called Start-Up financing. Lastly, First-stage financing occurs when companies use the venture capital to commence full-fledged business activities.
Expansion Financing: Expansion financing is classified into Second Stage Financing, Bridge Financing, and Third Stage Financing. Second-stage and third-stage financing is a kind of expansion financing, typically provided to companies so that they can companies scale up their business and operations. Bridge financing, on the other hand, is a kind of financing that is typically provided to companies whose business strategy includes the plan to go public through an IPO.
Acquisition or Buyout Financing: Acquisition or buyout financing is a type of financing that is used to fund acquisitions or leveraged buyouts. In an acquisition, one company purchases another company or part of another company. In a leveraged buyout, a management group of one company wants to acquire a product of another company.

VCF ensure that the venture capital (money provided in the VCF) is used only for projects, startups with a potential for high growth. Hence, in spite of a high-risk, they have the potential of giving extremely high returns on investments.
For any company in early stages of growth, networking is significant, and that is the biggest advantage the VCF investors bring. Influential, rich, investors with a lot of connect promote these startups, increasing their visibility, exposure, through positive marketing, helping them grow.
The investors in the VCF, often bring to the table knowledge and experience, that help the companies, or startups grow as per their vision and goal. These sophisticated investors of VCF, can also sometimes contribute to the growth of the company by helping in developing new products, services, and even help them to acquire the latest, advanced technologies to increase efficiency.
VCFs have a lot of hold on the companies they invest in, and hence can influence the decisions.
The VCFs also have the ability to invest in multiple projects at the same time. This can mitigate the high-risk that is usually involved in investing in this category. Out of many startups, at least one can grow massively, giving them high returns to cover their entire investment.

The process is lengthy, and complex, and contains a high risk.
Investments are for a long term which means profits made are realized in the very long run.

Always a good idea to look for potential startups having a very strong management team, with inimitable/unique ideas or products and a good potential market for it.
Investment structure and strategy of the fund
Industries in which it is investing. It is also a smart idea to invest in industries you are familiar in, thus can advise, nurture, in order to ensure growth, and get high returns on investments.
Startups that the VCF has funded
Minimum Lock in period