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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Private Equity and Venture Capital
May I know what are the practical considerations and implications for private equity and venture capital?
Thanks
Well here are a few off the top of my head:
Considerations:
Finding the people to invest in the first place.
Being able to offer them enough to persuade them to invest (e.g. potential for future growth)
Implications:
Problem: The existing shareholders will have less control (because the new investors will have a vote, and therefore a say in how the company is run).
Benefit: The extra finance will enable the company to grow which is potentially good for both existing and new investors.
is tht means basically practical considerations refers to factors (i.e before I use venture capital and private equity -like whether my company gt the ability to use this source of finance or not) , while practical implications refers to advantage and disadvantage (after I use venture capital and private equity will be how like is it good or bad to my company) ?
Thanks
Correct 🙂
