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Exploring the Common Types of Venture Capital


November 30, 2017 ( Newswire) Those seeking venture capital want to know which types they might want to pursue. There are multiple options, so starting off with the most common options gives you some basic and foundational information. You might also look into resources from top entrepreneurs and investors by looking up information about them, such as such out Chris Sacca LinkedIn. This gives you some basic knowledge, allowing you to make better decisions both on the investing side and the startup in need of investing side.

Seed Capital

Those who are just starting out and have no organized company or product yet might go for this type of capital. There are not many venture capital options at this stage and the investments tend to be on the smaller side. The capital secure may be used to fund market research, create a sample product or cover administrative setup costs.

Startup Capital

Once a company has a sample product and a minimum of one principal working full-time, this is the funding they might pursue. In most cases, it is used to finalize a service or product, fund additional market research or introduce a service or product to the marketplace.

To get more information about success in this type of investing, you might consider looking at some of the biggest names in the industry and their professional accounts, such as Chris Sacca LinkedIn. Sacca is an accomplished company advisor, venture investor, entrepreneur, and he is a former attorney. He portfolio includes more than 80 consumer mobile, web and wireless technology startup companies. He has amassed billionaire status due to his success in venture capital.

Early Stage Capital

This is the funding that someone might seek out when they are approximately two to three years into their venture. The company is off of the ground, sales are increasing and there is a stable management team in place. Venture capital might be used to improve productivity, increase sales to break even or to enhance overall company efficiency.

Expansion Capital

This type of financing might also be referred to as bridge financing, mezzanine financing, second-stage financing or third-stage financing. When a company is ready to start the expansion process, this is the type of financing that they might consider seeking. In most cases, this involves a major expansion of some sort, such as adding new locations or transitioning into a new major service or product. It might be provided as a form of monetary assistance for companies utilizing Initial Public Offers or as a short-term finance option that is interest-only.

Late Stage Capital

Companies seeking this type of funding have impressive revenue and sales and have second level management. They might need funding at this stage to ramp up their marketing efforts, increase overall capacity or increase their working capital. This could help to take a company to the next level.

Buyout or Acquisition Capital

If you are looking to acquire either an entire company or a part of it, this is the type of financing that you might consider seeking. If you want to obtain a specific product from a company, you might look into a specific type of this capital which is referred to as leveraged or management buyout financing.

Whether you are seeking funds, or you want to start investing, you want to start with knowing your options. These are just some of the most common types, so that you have some basic information. Before diving into this industry, it is important to make sure that you are fully educated on the options, as well as the trends in the industry. This level of information is imperative to ensure that you are making the right decisions.

Source Steve Barker


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