It is the financing of startups and small companies by investors who believe in their long-term growth potential. Since startups lack access to capital markets, borrowing is very difficult. Venture capital today enables these small businesses to receive the necessary financing.
The key players on the investor side (venture capitalists) include funds, companies or venture capital managers, business angels, etc. and their business model consists of investing their money in different startups to diversify risks and with the hope that in this bet, some achieve success, offering high profitability, which will materialize through its sale after a few years.
Venture capital is becoming an increasingly popular source for startups to raise capital. According to ASCRI, investment in venture capital will close the year at around 6,000 million euros, a record figure that confirms the growing investment pace and the ability of Spanish start-ups to attract the interest of investors
The ecosystem is completely changing. The increase in players in the Venture Capital sector and the increasing operations in the sector confirm the boom in the venture capital sector in recent years.
In this boiling environment, venture capital financial models emerge as essential tools both:
- For the venture capital company that needs to evaluate the potential investment of a startup.
- For entrepreneurs who need to prepare a financial venture capital model to demonstrate why investing in their idea or project is a great idea due to the attractiveness of the investment.
With these development perspectives, currently, knowing how to build a business plan and structure a venture capital operation is an essential competence for an entrepreneur
If you are an entrepreneur, surely you have a fantastic idea and dream of growing your project.
But, to understand your business and its profitability, you will need to land the ideas in a Financial Business Plan. The Business Plan becomes an essential “TO DO” as it will allow you to:
- Get to know your business better: its strengths and weaknesses
- Explore growth and profitability levers
- Manage the day to day learning to manage liquidity
- Seek financing and learn to speak the same language as companies