Venture capital can help fund growing small businesses seeking further development. Venture capital firms provide unsecured funding in exchange for shares of the company, seeing it as a high-risk/high-return investment. They may require board representation given the risk. Venture capital is best for businesses needing growth funding beyond what banks or owners can provide, and is often used in management buyouts where management invests alongside the venture capital firm.

1. Financial growth

2. Specification detail
• How to finance a business from both internal
sources (profit, asset sales) and external
sources (share capital, debt) including stock
market flotation

4. Economies of scale: Here

8. Venture Capital
• Venture capital: how does it work?
• Venture capital can help fund a growing business
• Small and growing businesses seeking to finance further development may find the
answer in venture capital. Venture capital is the term used for unsecured funding provided
by specialist firms in return for a proportion of the company's shares.
• Venture capital investments are seen as relatively high risk because they are unsecured.
• The venture capital firm will therefore be looking for a high return (perhaps a compound
return of 25% or more), largely generated by growth in the capital value of the business.
• It may well also require representation on the company's board.
• Venture capital (VC) is worth considering if your business needs funding for growth, but
can't raise necessary funds through a bank loan, overdraft or by an injection of further
capital from the current owner.
• VC money is commonly used in conjunction with a management buy-out (MBO) or buy-in
(MBI), where the management team are themselves investing in the business and so
demonstrating their commitment to its success.

9. James Saddon: Here
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10. A-Z GCSE Worksheets
42: Financing growth