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Which of the following statements are false ? Indicate the correct code. (a) Share capital issued by a company for the first time is known as venture capital. (b) All Venture Capital Funds in India are promoted by the Government. (c) In addition to capital, venture capitalists provide managerial and technical support also to the assisted firms. (d) Benefits from venture capital financing can be realised in long run only.

Which of the following statements are false ? Indicate the correct code. (a) Share capital issued by a company for the first time is known as venture capital. (b) All Venture Capital Funds in India are promoted by the Government. (c) In addition to capital, venture capitalists provide managerial and technical support also to the assisted firms. (d) Benefits from venture capital financing can be realised in long run only. Correct Answer (a) and (b)

Venture Capital:

a) Venture capital (VC) is a form of private equity financing that is provided by venture capital firms or funds to startups, early-stage, and emerging companies that have been deemed to have high growth potential or which have demonstrated high growth (in terms of the number of employees, annual revenue, the scale of operations, etc.). Venture capital firms or funds invest in these early-stage companies in exchange for equity, or an ownership stake. Venture capitalists take on the risk of financing risky start-ups in the hopes that some of the firms they support will become successful.

b) Venture Capital typically comes from institutional investors and high net worth individuals and is pooled together by dedicated investment firms. It is the money provided by an outside investor to finance a new, growing, or troubled business. 

c) Venture capitalist finances innovation and ideas, which have the potential for high growth but are unproven. This makes it a high risk, high return investment. In addition to finance, venture capitalists also provide value-added services and business and managerial support for realizing the venture’s net potential.

d) Start-up companies with the potential to grow to need a certain amount of investment. Wealthy investors like to invest their capital in such businesses with a long-term growth perspective. This capital is known as venture capital and the investors are called venture capitalists. Venture capital financing is a long term investment. It generally takes a long period to encash the investment in securities made by the venture capitalists.

Thus, options A and B are False.

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