MANAGEMENT

BUISENESS MANAGEMENT

BUSINESS PLANNING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
____ is money invested in a business by investors who form partnerships or groups to pool investments
A
Debt financing
B
Equity financing
C
Venture capital
D
Capital structure
Explanation: 

Detailed explanation-1: -Venture capital funds are pooled investment funds that manage the money of investors who seek private equity stakes in startups and small-to medium-sized enterprises with strong growth potential. These investments are generally characterized as very high-risk/high-return opportunities.

Detailed explanation-2: -An angel investor works alone, while venture capitalists are part of a company. Angel investors, sometimes known as business angels, are individuals who invest their finances in a startup. Angels are wealthy, often influential individuals who choose to invest in high-potential companies in exchange for an equity stake.

Detailed explanation-3: -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-4: -Venture capital (VC) is a form of investment for early-stage, innovative businesses with strong growth potential. Venture capital provides finance and operational expertise for entrepreneurs and start-up companies, typically, although not exclusively, in technology-based sectors such as ICT, life sciences or fintech.

Detailed explanation-5: -Venture capitalists make money from the carried interest of their investments, as well as management fees. Most VC firms collect about 20% of the profits from the private equity fund, while the rest goes to their limited partners. General partners may also collect an additional 2% fee.

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