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Venture capital mind map
This is a mind map about venture capital, venture capital and private equity, including an introduction to venture capital, the supply of funds in venture capital, the operating institutions of venture capital, etc.
Edited at 2023-11-14 13:42:34
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Venture capital mind map
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Venture Capital and Private Equity
[1. Introduction to venture capital]
The definition and connotation of venture capital
Narrow definition: It is an investment behavior that uses institutional and professional venture capital as an intermediary to provide equity capital for emerging and rapidly developing enterprises with huge competitive potential.
Broad definition: It is a branch of private equity investment, which is an investment behavior that provides equity or equity capital-like investment for new enterprises with high growth potential and accompanied by high risks through means other than the stock trading market.
institutional venture capital
affiliated venture capital
government-affiliated venture capital
bank affiliated venture capital
Corporate Affiliated Venture Capital
independent venture capital
angel investment
Dynamic: refers to venture capitalists investing equity capital into emerging, rapidly developing, and highly competitive enterprises (high-growth small and medium-sized enterprises), and conducting follow-up management of them, controlling risks, and transferring the equity after submitting the enterprise value, and exiting to gain Investment behavior with huge profits
Static: It is a kind of equity capital invested by professional financiers in emerging and rapidly developing enterprises with huge competitive potential.
The Origin and Development of Venture Capital
The formation and development of American venture capital
(1) The birth of the 1940s (2) Growth in the 1960s (technology, stock market, small business investment) (3) The low point of the 1970s (economy, stock market, Employee Retirement Income Security Act) (4) Growth in the 1980s (technology, regulations, limited partnerships, capital sources) (5) Prosperity in the 1990s (technology, economy, legislation and policy)
The background and conditions for the formation and development of venture capital
(1) Prosperous supply and demand of high and new technologies is the prerequisite for the existence and development of the venture capital industry. (2) A good financial environment is an external condition for the development of the venture capital industry. (3) A favorable policy and regulatory environment can promote the development of venture capital. (4) A sound capital market system provides guarantee for the development of venture capital. (5) The existence of compound talents who combine financial and technical knowledge.
The development trend of venture capital
(1) The trend of internationalization is becoming more and more obvious
(2) Intertwined development of centralization and diversification
(3) Investment scale continues to expand
(4) The trend of mutual penetration of venture capital between countries is increasing
(5) Investment objects are expanded and the investment stage is further extended.
(6) Countries have increased their support for venture capital
The status and role of venture capital in the national economy
Venture capital and high-tech innovation
(1) Characteristics of high-tech innovation
①. Technical uncertainty: Neither entrepreneurs nor investors who are engaged in technological innovation can grasp the development direction of their new technologies, nor can they be sure whether the chosen adoption direction is correct and whether it will succeed.
②. Uncertainty of the market: The market is ever-changing, and companies’ market forecasts cannot always keep up with the pace of market development. Therefore, companies face huge market risks when carrying out technological innovation. However, if the market can accept the company’s products, This kind of market demand becomes an opportunity for business success.
③. Uncertainty of the institutional environment: The institutional environment consists of government behavior and public preferences, and there is great uncertainty in both government behavior and public preferences.
(2) Venture capital provides financial support for high-tech industries
①.Institutional investors
②.Industrial affiliated investment company
③.Angel investors
④.Venture Capitalist
(5) Venture capital companies
Venture Capital and Development of Small and Medium Enterprises
(1) The important role of small and medium-sized enterprises in the modern economy
① Small and medium-sized enterprises have become an indispensable and important part of a country's economy. ②The economic activity of small and medium-sized enterprises often reflects the activity of a country’s overall economic activities. ③ Not only can it create a large number of jobs and make positive contributions to increasing employment and promoting social stability, it has also become a pioneer in technological innovation to a large extent. Leading the trend of applied technology innovation.
(2) Characteristics of small and medium-sized enterprises
①Not many tangible assets
②The management system is more flexible
③When starting a business, you need non-traditional funding channels to support your own technological innovation.
(3) Venture capital promotes the development of small and medium-sized enterprises
① Provide funds needed for development of small and medium-sized enterprises
② Promote technological innovation and industrial structure upgrading of small and medium-sized enterprises
③Promote small and medium-sized enterprises to establish modern management systems
④It is helpful for small and medium-sized enterprises to optimize resource allocation and improve capital utilization rate.
Characteristics of venture capital
(1) Venture capital is an investment that combines high risks and high returns.
(1) These investments are unsecured investments. (2) Investment targets are often seed technologies in high technology, mostly involving design ideas and innovative small businesses that have just started, and there are many uncertain factors. Therefore, when this technology is turned into products, research experiments are very risky. (3) This product has low cost, high efficiency, good performance, and strong market competitiveness. Once successful, the profit rate will be high.
(2) Venture capital is a cyclical medium- and long-term investment with very little liquidity.
(1) The investment cycle must go through research and development, product trial production, formal production, expanded reproduction, and then further expansion of profit scale, further increase in production and sales. Until the company's stock is listed and the stock price is listed, investors can recover their risk capital and obtain investment profits. (2) This process will take 3 to 5 years or 7 to 10 years (3) He generally goes through a process of investment---investment---management---exit---distribution---reinvestment.
(3) Venture investment is a kind of equity investment
(1) Invest in entrepreneurial enterprises in the form of equity participation, profit from dividends and equity transfers, and focus more on the development prospects and asset appreciation of the enterprise. (2) There are essential differences between risk capital and bank loan capital: ① Bank loan capital constitutes the debt of an enterprise. The bank's focus is on the profit and loss of the company to ensure its smooth recovery of principal and interest.
(4) Venture capital is an investment that combines investment and financing
(1) First, a fund must be raised, and this fund exists in the form of equity capital, and then the funds raised can be used to purchase the assets of the enterprise that has just been operated or has been operated. (2) What venture capitalists buy is capital, and what they sell is their reputation and the expectation of future returns from attractive investment plans.
(5) Venture capital is an investment that combines capital and management
(1) After a venture capitalist invests capital into an enterprise, he or she owns part of the ownership of the enterprise and becomes a shareholder of the enterprise. A principal-agent relationship is formed between the venture capitalist and the entrepreneur. (2) Venture capitalists appear as investors. They usually have a certain professional and technical knowledge background, rich business management experience and investment experience, and have a smooth network of relationships, which can bring more funds to the enterprise. . What entrepreneurs have is a certain entrepreneurial idea or a certain proprietary technology. Although they know the internal situation of the entrepreneurial enterprise well, they lack the corresponding production management experience and the channels and information to obtain funds.
(6) Venture capital is an investment that combines finance and technology
(1) The two main elements that form the venture capital mechanism are capital and high-tech, both of which are indispensable. Venture capital is mainly concentrated in high-tech industries, and venture capital is created to support this innovative industry. Venture capital in today's world is almost synonymous with high-tech industry investment (2) The venture capital industry is also a knowledge-intensive, technology-intensive, and talent-intensive industry.
(7) Venture capital is an investment that cannot obtain funds from traditional channels.
(1) Technology innovators in the entrepreneurial stage face the following financing methods: ①Internal fundraising. This approach is difficult to apply to most technology innovation companies ②Loan from bank ③Issue bonds ④Issuance of shares
(8) Venture capital is an investment mainly aimed at high-tech small and medium-sized enterprises
(1) Venture capital can be understood as an important supplement to traditional investment mechanisms (2) It is a more advanced investment mechanism produced after the financial investment mechanism has developed to a relatively mature stage. The objects he invests in are areas that ordinary investment institutions are afraid of and are unwilling to invest in.
(9) Venture capital is a positive investment, not a negative gamble
(1) Venture capital achieves capital appreciation through the growth of entrepreneurial enterprises. It measures investment returns through the overall efficiency of investment. (2) It seems a bit risky, but in fact it is a manifestation of the spirit of exploration and pioneering. Although this kind of exploration and development is also aimed at pursuing profits, it still does not prevent it from objectively promoting the development of the national economy.
[2. Fund supply in venture capital]
(1) Sources of risk capital
wealthy individual
(1) Investors with basic qualities in venture capital operations, some of whom were originally investment managers, later set up their own businesses and tried to find a more suitable target market for themselves in an increasingly segmented market.
(2) Previous entrepreneurs have received venture capital support and received huge returns from their entrepreneurial ventures. Due to my strong interest in technology and entrepreneurship, I hope to use funds to support other entrepreneurs in the same industry.
capital surplus department
government
① Fiscal appropriation: mainly funds projects that play an important role in national economic construction, such as the National Natural Science Foundation of China
②Government direct investment: Government direct investment is mainly equity investment and government loans
③Government-guaranteed bank loans
enterprise
Enterprises are important participants in venture capital. Their main purpose of borrowing venture capital is to consider development strategic goals, that is, to seek new growth points for themselves through investment in entrepreneurial enterprises, and even realize a second entrepreneurial venture.
resident
Corporate financial intermediary sector (institutional investors)
commercial Bank
insurance company
investment bank
investment company
Pension funds
endowment fund
foundation
financial shortage sector
regular enterprise
venture
foreign investors
Foreign investment in a country's venture capital can make up for the country's lack of domestic institutional and individual investment capabilities.
The composition of foreign venture capital
USA
The U.S. capital market is very developed and implements a market-oriented financial system.
Japan
Most Japanese venture funds are affiliated with bank-centered financial groups and large corporate groups. There are relatively few social-oriented or publicly raised funds, forming a quasi-governmental characteristic of "depending on financial enterprises" and "mainly institutional investment"
Germany
The vast majority of risk funds in Germany are provided by subsidiaries of state-owned banks, private banks, savings banks or institutions in which they participate, while insurance companies, industrial companies, government agencies and other investors are mainly engaged in traditional investment activities. Relatively small
U.K.
49% of venture funds in the UK obtain financing from pension funds, accounting for 39% of the total capital of venture capital funds. This is inseparable from the UK’s pension scale and developed pension system.
(2) The role of the government in the supply of venture capital funds
Reasons for government involvement in venture capital
Analyze from the perspective of the essence of venture capital
Venture capital is a social risk sharing mechanism. It cannot bear all the uncertainties of entrepreneurial enterprises, and government intervention can play a huge role in eliminating uncertainty in the market and policy environment. Venture capital cannot leave the city and be independent, taking on all the uncertainties of a startup.
Analysis from the perspective of venture capital movement
All aspects of the operation of venture capital enterprises are inseparable from the reasonable regulation of government policies. The movement of venture capital can be summarized into three stages, the raising stage of venture capital, the use stage of venture capital and the recovery stage of risk capital.
Analysis from the perspective of smooth operation of venture capital
Venture capital is inseparable from the strong assistance of the government. Venture capital is the product of the development of the entire country's economy and system to a certain extent.
Analyzing the social benefits generated by government participation in venture capital
Government venture capital programs could generate greater social benefits Different from general commercial venture capital, government venture capital programs are usually aimed at obtaining public benefits, promoting innovation, promoting economic growth and creating jobs.
Forms of government participation in venture capital
direct investment
Government Procurement
Financial subsidy
government guarantee
Government policy support for venture capital
tax policy
Legal Construction
Market building
(3) Institutional investors
Institutional Investors Overview
Characteristics of institutional investors
Institutional investors are at a comparative advantage in the collection, possession, processing and feedback of information.
From the perspective of operation mode, the complete and systematic organizational form provides guarantee for the scientific decision-making of institutional investors.
Institutional investors and individual investors have different orientations in investment channels, and the pressure and motivation to promote innovation in capital varieties are also different.
The impact of the development of institutional investors on venture capital
Promote the development of venture capital to late stages
A venture capital company with huge funds can give a startup a lot of money, but it cannot put too many people and energy into it. This is consistent with late-stage investment.
While institutional investors provide funds to venture capital funds, they also exert pressure on fund operators. Institutional investors are increasingly concerned about internal rates of return and cash flow, requiring their money to take less risk, and this increasing pressure is driving venture capitalists to invest in later stages
Strengthened the incentive and restraint mechanism of venture fund companies
Changes in administrative expenses
Changes in profit distribution
major institutional investors
Pension funds
investment bank
insurance company
Enterprise Group
Motivation: ① Quickly obtain more sources of technological innovation to help companies enter the latest industry fields ②Control innovation costs and effectively reduce investment risks ③ Obtain strategic development opportunities and cultivate the innovation culture of enterprises
(4) Private investors and foreign investors
private investor
Private Investor Overview
①Individual investors may only invest in one enterprise, or they may invest in several different enterprises at the same time ②The private investor group includes retired businesses, senior managers and savvy and wealthy corporate giants, as well as wealthy clients of commercial banks and investment banks.
The organizational form of private investors
Angel investment, general partner status (limited partnership)
Main sources of angel investment capital
Former entrepreneur
rich man in traditional sense
Elites from large high-tech companies
Angel investment operating model
Facilitate meetings between investors and entrepreneurs through introductions from acquaintances
Matchmaking through the so-called angel network
Measures to be taken to develop angel investment in my country
Formulate relevant policies and laws to create a good legal and policy environment
Establish an online platform dedicated to serving startups and angel investors
Cultivate a group of angel investors with investment capabilities and professional knowledge
Improving the construction of my country's credit system
foreign investors
The form in which foreign investors enter the venture capital field of a country
Venture capital subsidiaries of multinational companies, such as IDG, which are active in my country, etc.
Traditional venture capital companies (funds). These companies have been engaged in venture capital as their main business abroad. They entered the Chinese venture capital market relatively late, but they have large capital scales and rich investment experience, and will show an increasingly strong development trend in the future.
Venture capital subsidiaries of foreign financial institutions
Combined with domestic funds to form a Sino-foreign joint venture venture capital fund
The positive effects of the entry of foreign investors
International venture capital can bring large amounts of capital investment to high-tech industries
International venture capital can provide a full range of services for our country’s venture capital
Provide entrepreneurial capital required for start-up companies
Provide management consulting services and professional talents
Assist enterprises to formulate internal management systems and business strategies and plans
Form an investment group to help entrepreneurs raise funds
Participate in the board of directors to assist in resolving major operating decisions
Recommend potential suppliers or buyers
Provide advice on legal and public relations
Use its network of relationships to provide technical consulting information and ways to introduce technology
Provide suggestions and assist enterprises in reorganization, mergers, strategic alliances, stock listings or joint development
By arranging the governance structure in the investment agreement, international venture capital effectively solves the problem of incentives and constraints for entrepreneurs and the management team of invested companies. Solution: First, equity arrangement, second, option arrangement
The entry of international venture capital can introduce talents, technology and management experience to our country
[3. Operating institutions of venture capital]
Overview of venture capital institutions
The concept of venture capital institutions
Venture capital institutions invest in unlisted small and medium-sized enterprises. It mainly participates in investment in the form of equity. After the invested company reaches its potential and the equity value increases, the equity will be transferred to realize the investment income. Therefore, venture capital is a long-term investment.
The investment objects of venture capital institutions are high-risk, high-growth, high-yield new ventures or venture capital plans. The selection of investment projects by venture capital institutions is highly specialized and procedural.
The relationship between venture capital institutions and entrepreneurs is based on mutual trust and cooperation, thus ensuring the smooth execution of investment plans
Legal issues related to venture capital institutions
Financing stage of venture capital institutions
commitment system
Fund system
Risk capital operation stage
The main business content of venture capital institutions is to find, screen and negotiate venture capital projects, sign investment agreements, and supervise and manage the agreements after they take effect.
Risk capital exit stage
The exit stage is also the best stage and is the only way for all parties in venture capital to realize their respective interests.
Classification of venture capital institutions
listed company
privately owned company
bank subsidiaries
Venture Capital AG
syndicate
government venture capital agency
Operations of Government Venture Capital Agencies
The venture capital company
Seed Fund
Government venture capital institutions in various countries
Corporate Venture Capital Institution
Motives for companies to participate in venture capital
Pressure from product structure and industrial structure adjustment
More severe profit pressure
Demonstration Effect of Foreign Venture Capital
Listed companies have a stronger awareness of venture capital
Financing channels for listed companies are relatively smooth
Listed companies have a clearer understanding of the role of improving technology levels
The stimulating effect of becoming a hot spot in the secondary market
The main forms of corporate participation in venture capital
In-house venture capital
A new type of venture capital organization---New Entrepreneurship Group
Features:
Investment scope is different
Different measures of project success
Decision-making mechanisms are different
Different incentive and restraint mechanisms
Corporate external venture capital
Center cvc mode
independent cvc branch
entrust cvc
Private and foreign venture capital institutions
private venture capital firm
The development status of angel investment in my country
The highly educated newly wealthy class who have returned from overseas and the Chinese senior management in foreign companies
Some self-employed people in China, including individual company owners, and groups of high-income individuals in some industries
Some people who have a large amount of wealth accumulated by their families for generations need to invest in the current market situation of weak appreciation, but lack good investment methods.
The development of foreign venture capital institutions in China
American International Data Group established its first fund in mainland China, American Pacific Technology Venture Capital Fund
Characteristics of foreign venture capital institutions
"Both ends outside" operating mode
Investment is mainly concentrated in the expansion and maturity stages of enterprises
The types of companies invested in have changed
Investment is concentrated in the developed eastern regions
Combining diversification and portfolio investing
Cooperation between domestic and foreign venture capital institutions is strengthening
Venture capital has become an important part of the China strategy of foreign-funded enterprises
Acquisition investment funds abuse venture capital policies
[4. Dominant organizational forms of venture capital]
1. The Origin of Limited Partnership
The bud of limited partnership: separation from general partnership---adapting to the needs of high-risk investment
Adapt to the high-risk investment needs of maritime trade
The short-term nature of Kang Mengda provides investors with a convenient way to exit.
Different needs for management structures
The development of limited partnerships---a comprehensive choice of multiple legal and economic factors
The new life of limited partnership---the need for diversified business organization forms
2. Characteristics of limited partnership
The economic and legal reasons why limited partnership has become the mainstream organizational form of venture capital
Institutional Characteristics of Limited Partnership
Meaning: A limited partnership is a type of partnership, usually consisting of two types of partners, namely limited partners and general partners
general partner
Liability: 1% capital investment and unlimited liability
Income: 1% to 3% management fee and 10% to 30% capital gains
limited partner
Liability: 99% capital investment and limited liability
Income: 70% to 90% capital gains
distribution form
Organizational form and operations
Fund raising form of partners
tax
responsibility
General partners have unlimited liability. His personal property is at risk
Operation period
Usually ten years, but not fixed
liquidation
End business
repay all loans
Pay taxes due
Distribute property among partners
Cancel partnership account
Obtain written certificate of dissolution
3. Limited partnership contract
The difference between a limited partnership and an ordinary company
Different from civil law countries
Partnership is a one-level tax system, avoiding double taxation
Contractual Characteristics of Limited Partnership
legal structure
Before signing a partnership agreement, the risk capital termination date must have been determined and agreed to by all parties to the partnership.
Transfer of ownership of limited partners subject to restrictions
It is prohibited to withdraw from a partnership before the expiry date
As long as limited partners only bear limited liability to the extent of their capital contribution, they are not allowed to participate in the management of risk funds.
Contribution
Under normal circumstances, limited partners provide 99% of venture funds, while general partners only provide about 1% of venture funds.
economic life
Investment time
remuneration
distribute
Reporting and accounting policies
special conflicts of interest
Dedicated advisory board
Restrictive contractual clauses (relating to overall fund administration)
Limit the amount of investment in a single business venture
Limit the use of debt
Restrict venture capital institutions from co-investing in funds raised at different times
Limit reinvestment of profits
Restrictive Contractual Clauses Relating to the Conduct of the General Partner
Restricting general partners from investing personal funds in entrepreneurial ventures
Restrictions on the sale of partnership interests by general partners
Restrictions on raising new funds
Limit outside activities of general partners
Limit the addition of new general partners
Restrictive contractual clauses that limit the types of investments
Restrictions on investments in other venture capital funds
Restrictions on investment in public securities
Restrictions on LBO investments
Restrictions on Foreign Portfolio Investments
Restrictions on investing in other assets
[5. The operation process of venture capital]
1. Project preliminary selection
project source
Investment policy and project screening
Investment scale
investment industry
investment stage
location preference
Evaluation indicators and project screening
Evaluation metrics for seed and founding stages
Evaluation indicators for growth and expansion stages
2. Due diligence and project final selection
Due diligence content
Due diligence methods and procedures
Evaluation indicators for final project selection
The quality of personnel
market expectation
techinque level
Financial status
Exit mechanism
Comprehensive evaluation of the project
3. Contract Negotiation
Main needs of both parties
Key issues of concern to investors
Main issues that entrepreneurs are concerned about
Negotiation Term Sheet
venture capital agreement
Arrangement and inspection standards of investment amount and investment time
Types and composition of securities used as investment and financing tools
Shareholding ratio and security conversion price
Relevant breach of express and warranty commitment terms and remedies
Dividend policy
How to buy back shares
Listing and cashing out stocks
managers and employees
Information disclosure procedures
Board of Directors
Liability for breach of contract
other conditions
Performance Clauses and Forfeiture Clauses
employment contract
control clause
shareholders agreement
[6. Management of venture capital]
1. Overview of Risk Investment Management
The connotation and characteristics of venture capital management
The connotation of venture capital management
Characteristics of venture capital management
The content and model of venture capital management
Value-added service management
Supervision, control and management
How to manage venture capital
Join a startup board of directors
Review startup business operating reports
Have phone calls or meetings with startups and senior managers
Factors influencing venture capital management
Development stages of entrepreneurial enterprises
Equity ratio
investment industry
investment effect
2. Control over distribution rights
The Economic Significance of Control Rights in Entrepreneurial Enterprises
The meaning of entrepreneurial enterprise control rights and the characteristics of its configuration
The meaning of control rights in entrepreneurial enterprises
Characteristics of the configuration of control rights in entrepreneurial enterprises
Measures to allocate control rights in practice
Capital injection in stages
Use of convertible securities
Stock deferred cash out provisions and non-compete provisions
3. Phased investment
The stages of venture capital
seed funding
Introduction period funds
first round of funding
Second round of funding
third round of funding
Fourth round of funding
Structural characteristics of staged investment
Factors influencing the staged venture capital investment structure
Agency cost under information asymmetry is an important institutional factor affecting staged investment structure
Supervision costs are also institutional factors that affect staged financing structures.
The nature of corporate assets has an important impact on expected agency costs and the staged venture capital investment structure
Market value/book value ratio of entrepreneurial enterprises is a technical influence factor of stage financing structure
The growth of the sharing investment industry constitutes periodic risks and the environmental factors of capital investment
Analysis of the effect of staged investment on entrepreneurial corporate governance
Phased investment can reduce uncertainty and create a disruption mechanism
Staged investment can alleviate information asymmetry and strengthen venture capitalists’ control
Phased investment can institutionally solve the problem of single commitments
Staged investment will also have an incentive effect on entrepreneurial entrepreneurs
Staged investments also provide a way to measure the intensity of monitoring
Basic principles of staged investment
Depending on the company's conditions, fully safeguard the returns of venture investors while ensuring the company's capital supply in the right amount and as timely as possible.
Act within your capabilities, the key is to keep the value of your shares from being diluted
In terms of investment methods, the first phase of investment should be made in the form of convertible preferred stocks, convertible bonds, etc.
Looking at staged investment strategies from two cases
Apple Computer Amway
FedEx case
4. Selection of financial investment tools
The relationship between financial investment tools, incentives and control rights
Analysis of commonly used financial investment tools
[7. Exit of venture capital]
1. The role of venture capital exit
2. Ways to exit venture capital
3. Comparison of the main exit methods of venture capital
[Eighth and Second Board Market]
Characteristics, functions and operation modes of the first and second board markets
2. Nasdaq Market of the United States
3. European Second Board Market
4. Asian secondary market
5. China’s GEM Market and Science and Technology Innovation Board Market
[9. Government and Venture Capital]
1. Venture Capital and Public Policy
2. Legal environment of venture capital
[10. Venture Capital and Regional Innovation]
1. Venture capital in Silicon Valley, USA
2. Venture capital and industrial clusters
3. Venture Capital and Regional Development
think
If you are an entrepreneur, could you please explain why you are willing to obtain private equity financing?
(1) Raise funds through private placement and non-public issuance. Raise funds from institutions or individuals with risk identification and tolerance. Compared with individuals, they have more professional knowledge and ability to control risks, are relatively safer, and greatly reduce the risk coefficient. (2) The investment direction is equity, so debt is generally not involved. It will not be aimed at voting rights for corporate decision-making management, but will also help improve the corporate governance structure and help companies complete equity incentives. Set listing planning goals and graft M&A resources, etc. Supervise the development of enterprises, actively incubate projects, and exit mergers and acquisitions as soon as possible, etc.
If you were a government official, please explain your reasons for encouraging the development of the private equity industry?
As the backbone of economic development, small and medium-sized enterprises are full of uncertainties in technology, market and institutional environment. These uncertainties make their high-tech innovations risky and their failure rates extremely high. And this high-risk, high-yield feature just meets the requirements of venture capital. Different from traditional financing, as a dynamic investment behavior, it can not only help enterprises solve the funding problems that have long plagued technological innovation, broaden financing channels, and increase the possibility of successful technological innovation. Moreover, they can also participate in technological innovation activities, pay attention to the potential development of technological innovation, provide relevant professional knowledge and consulting services, and focus on the transformation process of technological innovation results, thereby increasing the probability of successful technological innovation. Answer: (1) Introducing venture capital into the technological innovation of small and medium-sized enterprises will help concentrate a large amount of idle funds in society. (2) The effective use of huge household savings will help alleviate the financing difficulties encountered by small and medium-sized enterprises when carrying out technological innovation activities. (3) It is also conducive to improving the situation of over-reliance on government funding for high-tech research and development funds in my country. (4) Increasing enterprise investment in research and development will help speed up the industrialization process of technological innovation results. (5) And by stimulating the innovation of small and medium-sized enterprises and technological innovation, it greatly increases employment (6) Can drive employment growth
Summarize
Glossary
angel investment
It is a form of equity capital investment that refers to people with a certain net wealth who make early direct investments in high-risk start-ups with huge development potential.
venture capital
growth investment
M&A investment
Leveraged M&A
Revitalize investment
private equity investment
broad sense
narrow sense