Venture Capital Fund And Its Development Strategy

Venture Capita] (also called as Risk Capital) means the investment behaviors toward the founding of hi-tech industries and or the provision of equity capital to unindustrialized small and medium-sized enterprises (SMEs)for purposes of recovering investment and obtain investment yield through equity transfer (ti-ansaction).Ln substance, Venture capital is a technocracy-based capital toward new pioneering undertakings. The entire process of venture capitals includes project gleaning, dutiful investigations, evaluation, negotiations and contract signing, cultivating pioneering undertaking, capital ~ithdmwal and reinvestment.Venture funds have adopted the traditional form of business organization -corporate system. Later on, limited partnership gradually becomes the leading form of venture funds. As far as investors are concerned, limited partnership has the highest efficiency.Venture capital withdrawal has many forms. With all forms of capital withdrawal, Secondary Stock Market or Growth Enterprise Market (GEM) is the optimal channel for the withdrawal of venture capitals.The development of China's venture funds faces a series of barriers, e.g.legal restrictions, State shareholding restrictions, few fund sources, cultural bamer and institutional drawbacks of securities market. Only after these barriers are overcome, can China's venture capitals develop soundly.