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Venture Models for Start-Ups

The document discusses three types of startups: promising startups, venture-backed startups, and corporate-supported startups. Venture-backed startups receive funding from venture capitalists in exchange for equity. They have confidence from VC approval but are under constant scrutiny. Corporate-supported startups are helped by corporations that provide resources like funding, office space, and technology in exchange for the startups' growth and innovation.

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Ockouri Barnes
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333 views9 pages

Venture Models for Start-Ups

The document discusses three types of startups: promising startups, venture-backed startups, and corporate-supported startups. Venture-backed startups receive funding from venture capitalists in exchange for equity. They have confidence from VC approval but are under constant scrutiny. Corporate-supported startups are helped by corporations that provide resources like funding, office space, and technology in exchange for the startups' growth and innovation.

Uploaded by

Ockouri Barnes
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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FEATURES OF VENTURE

MODELS
MANAGING AND GROWING THE VENTURE
PROMISING START-UPS

Promising start-ups do not have unique products or


vast sources of funding.

Their management teams are less experienced than


the venture-backed start-up.

However, they grow fast in terms of size and profits


and they have internal strength to fuel the business.
VENTURE-BACKED START-UPS

Venture-backed Start-ups are businesses which


acquire their capital from Venture Capitalists.

Venture capitalists back high-growth companies


in their early years in exchange for equity in the
business.
VENTURE-BACKED START-UPS con’t

 Venture Capitalist provide loans in return for high


rates of interest.
 Venture backed start ups have a lot of confidence
because the VC have given them the approval
because VC sees their potential to grow.
 VC look for strong mgmt. teams, unique ideas, and
how good they look for future takeovers by other
corporations.
VENTURE-BACKED START-UPS con’t

 VC are not willing to back start-ups forever.


They see an opportunity, help to build the
business to a certain stage and then
CASH OUT.
They take advantage of the expertise and
networking facilities that are available until then.
VENTURE-BACKED START-UPS con’t

 The downside to a business being backed by a


VC is that:
 The business will be under constant scrutiny.
 There is loss of autonomy.
 They have a representative on the board
 However, they continue to make contributions
to the economy through employment.
CORPORATE-SUPPORTED START-UPS

 Thismodel shows corporations helping start-


ups.
 They provide the right environment to aid
the business.
 They provide: membership, capital, office
space, technology and other resources that
you may need.
CORPORATE-SUPPORTED START-UPS con’t.

 Corporate supported start up models have


taken the companies under their wings, instead
of seeing them as a THREAT.
 The start-ups benefit from the corporations
knowledge of the market, their experience and
their established networks.
START-UPS

 A start-up company is not a typical small


business.
 It may be defined as an enterprise that has
recently been started and which has a high
growth potential.
 Innovation is key – something new in the market
 Growth oriented, experience fast growth,

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