Venture Capital Trust Fund investments are in startups and SMEs by providing not only capital but also technical support helps to facilitate growth and expansion in SMEs leading to wealth creation and provision of both direct and indirect jobs
Frequently Asked Questions
- Healthy track record in the PE/VC industry in Ghana
- Trustworthy local anchor in the industry
- Spearheading PE/VC industry development in the Ghana e.g. Fund Manager training, Technical Assistance program, Impact investing, Angel investing etc.
- Shared Resources and Responsibilities
Venture Capital investing involves the financing of companies at various stages of company life cycle. This is usually done by purchasing a combination of equity and quasi equity shares in the target company and deploying the human capital necessary to build value in same.
Venture Capital investors typically realize their invested capital and returns by any of the exit strategy such as owner, strategic third party buyers, Merger & Acquisition, initial public offering etc. Venture capitalists objective is to earn at least 10 times the value of the initial investment in 2-7 years.
Venture Capital is a long-term asset class, and is suitable only for long-term investors. Venture Capital is not only a financing agency but also a tool and a mentoring platform for the startup to grow and seek guidance from. Venture capital’s importance rises from the fact that it is patient and risk capital without which nascent ideas would not be nurtured.
- Increased capitalization
- Technical Assistance (eliminate operational barriers to growth)
- Regulatory and compliance processes.
- Dedicated business development and strategic board-level support from VC Fund Managers.
VC/PE investors bring knowledge and expertise to the companies in which they invest. Through active participation on the board or in partnership with management, private equity investors equip companies with critical improvements in governance, financial accounting, access to markets, technology, and other drivers of business success.
- Promotes Entrepreneurship: an entrepreneur converts his technical know-how to a commercially viable project with the assistance of venture capital institutions.
- Promotes exports: The Venture capital firms encourage export oriented businesses bringing into the country more foreign exchange earnings.
- Catalyst for growth: VC help businesses grow in the form of acquiring new technology, markets, diversifying, backward/forward integration by using their resources which otherwise would not have been possible for the start up.
- Creates more employment opportunities
- Brings financial viability: Assist companies in raising further funds and also create a situation where they can raise their own capital through the capital market.
- Helps development of Backward areas
- Build a base for formalized companies with quality to attract good IPOs in the future which would help the money market to grow.