New Government Regulations Related to Venture Capital

10 Sep 2018 08:18
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There are more startup companies growing within the country. They possess risks which conventional bank may not want to take. Therefore, these young companies begin to ask for starting fund from venture capital firms. In the past, people do not find many options for this type of capital. However, nowadays there are many firms offering such funding. The firms were not regulated by government but since their popularity increase, new regulations are established to control this industry. Start up and funding company’s rights are now protected well.

New regulations are broadening the kinds of activities a venture capital firm can conduct. The old regulations stated that such firm is only able to full or partial equity participation funding with profit sharing. Now, the funding firm is able to fund a business venture by purchasing the company’s debt securities in any stage of its business. The most common stages to be funded are the beginning and development stages. The change of regulations makes this industry more attractive to investors. But the changes are not limited to extension of functions.

The firm is now able to manage capital fund which will be used to start the new business venture. By doing so, funding company will have more control of their investment. The risk of their fund being mismanaged will lower significantly. The funding firm can also serve as mentor to its debtor. It can provide guidance related to company’s management. Fee system can be applied to such service.

There is no question that you need to find a trusted venture capital firm to fund your business. Since more power is given to funding firm, as prospective debtor, you need to choose the best deal in market. convergencevc.com is one of the most reputable funding firms in Indonesia. You can rest assured while working together with this company.

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