A venture capital fund is an investment type of private equity to invest in small businesses and ventures, to lead them to the next step. In this article we will tell you what venture capital is and why you should invest in one.
The Mexican Stock Exchange defines venture capital as an investment model that supports small businesses with high growth potential through resources and advice or mentoring.
A nivel global existen diferentes tipos de fondos de capital emprendedor a cargo de organismos, administradoras de fondos y bancos internacionales con el objetivo de elevar la competitividad y desarrollo de los proyectos y emprendimientos.
One of themis the Inter-American Development Bank (IDB) through a multilateral investment fund. With this fund, the capital is allocated to initiatives, ventures and small businesses in Latin America and the Caribbean (LAC).
In LAC exists the Association for Private Capital Investment in Latin America, a not-for-profit organization dedicated to supporting the growth of private equity to companies with high potential in the region. .
You can also read: What is entrepreneurial capital? Guide for this 2023
Why invest in venture capital?
Venture capital contributes to the development of innovative projects. They inject capital to potentiate the business model and also the administration and constitution of a corporate governance, defines the IDB data detail in its website.
Through an intermediary, entrepreneurs achieve access to the capital they need. And also, coordination with investors is encouraged.
In the IDB’s IDB data detail , this type of investment is focused on small businesses that have an innovative vision and impact the economic growth, creation of job opportunities and the development of new technologies.
Who can be an investor?
In general, investors seek innovative projects with the promise of high returns, highlights the Mexican national financia in its website.
A venture capital investor should consider the following:
- Character of the business partners: this fact is extremely important behind an idea.
- Capacity of the business partners: you need to make sure each person is highly qualified and possesses the ability to take the business to the next level.
- Stand out for an innovative idea:less than 1% of all U.S. companies are receiving VC money, investors need to get interested in innovation.
- Need to have the ability to detect ideas that solve a problem and that have a future in the market.
This investment solution gives a lack of accessibility to other capital alternatives for small companies and ventures.
No obstante, datos del IDB data detail that in Latin America and the Caribbean there are few venture capital funds to cover the ecosystem needs.
WORTEV CAPITAL is a Venture capital que incentiva el crecimiento de emprendimientos a través de capital y con mentorías en la operación de los emprendimientos a través de una Aceleradora nuclear de negocios.
Denis Yris, founder and CEO of WORTEV CAPITAL in a webinar called How to support companies growth? explain that through a fund, investors inject capital in the most promising projects and from the startup accelerator they offer operation services to growth companies and have better returns.
If you are an entrepreneur or an investor, WORTEV CAPITAL, whose objective is to generate an ecosystem for investors and entrepreneurs that positively impacts everyone.
