BANKING AFFAIRS

Detailed explanation-1: -In 1973 a committee on Development of Small and Medium Enterprises highlighted the need to foster venture capital as a source of funding new entrepreneurs and technology.

Detailed explanation-2: -Venture capital (VC) is a form of private equity and a type of financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential. Venture capital generally comes from well-off investors, investment banks, and any other financial institutions.

Detailed explanation-3: -Aside from the financial backing, obtaining venture capital financing can provide a start-up or young business with a valuable source of guidance and consultation. This can help with a variety of business decisions, including financial management and human resource management.

Detailed explanation-4: -In 1975, venture capital financing was introduced by the all-India financial institutions with the inauguration of the Risk Capital Foundation (RCF) sponsored by IFCI to supplement promoters’ equity as means of encouraging technologists and professionals to promote new industries.

Detailed explanation-5: -Venture capital, as an industry, originated in the United States, and American firms have traditionally been the largest participants in venture deals with the bulk of venture capital being deployed in American companies.