Venture Capital

Obtaining venture capital investment

Raising venture capital is not a simple matter. Many factors have to be carefully considered, and if the entrepreneur gets it wrong, he risks losing both his business idea and any time any money that he has invested.

Danziger Capital Partners LLP advises United Kingdom entrepreneurs on raising venture capital, negotiating with venture capital investors, and choosing the best deal from available investor sources.

Choosing a vehicle

A venture capital business should not be left in the hands of a sole proprietor or a traditional partnership, because of the liability risks involved for the participants. Instead, transfer the business assets into a company or a limited partnership, taking care to ensure that the participants do not incur personal liability for debts of the company or for any liability that might arise from its business going wrong.

What will investors be looking for?

Before the credit crunch, venture capital investors routinely demanded a gross annual return on investment of at least 25 percent. This level of return may now be more modest, in the current economic climate. But this level of demanded return should not frighten the entrepreneur, taking into account that the return on capital generated by a AAA-rated company of about 35 percent.