Venture Capital

Venture Capital

Brief Excerpt from Industry Overview Chapter:

Companies in this industry invest capital in new business ventures. Major venture capital firms include Accel, Kleiner Perkins, New Enterprise Associates, and Sequoia Capital (all based in the US), as well as Amadeus Capital Partners (UK), Globis Capital Partners (Japan), Nexus Venture Partners (India), and Singulariteam and Viola Ventures (both based in Israel).

COMPETITIVE LANDSCAPE

Demand is driven primarily by the pace of technological innovation and the number of companies created to commercialize new technologies. The profitability of individual companies depends on successfully choosing and managing a portfolio of investments. Large firms have advantages in attracting capital, developing expertise in multiple technology markets, and funding large deals. Small companies can compete effectively by concentrating on specific market sectors or geographic areas.

PRODUCTS, OPERATIONS & TECHNOLOGY

Venture capital companies provide money to young, rapidly growing companies with promising new products or services in exchange for ownership (equity) in the company. Major market sectors for venture capital investments include software; biotechnology and medical devices and equipment; and consumer products and services. Major services include trading securities and commodity contracts as well as financial management consulting and implementation, which accounts for 30% each, followed by financial management consulting at about the same revenue of about 30%. Other services include trading equities (20%), other products supporting financial services (10%), and Trading derivatives (5%).