Text Book : Download Each Chapter Separately -Book Title:- (VENTURE CAPITAL & PRIVATE EQUITY: FUELING STARTUP GROWTH AND MANAGEMENT)

By Dr. Balagouda S. Patil

Dr. Shiva Johri

PAPER BACK ISBN : 978-81-977620-0-0

E-ISBN : 978-81-982406-3-7

DATE : 2024

PAGES : 1-267

EDITIONS : 01

LANGUAGE : English

DOI : https://doi.org/10.52458/9788198240637.nsp.2024.tb

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How to Cite:   Patil, B. S., & Johri, S. (2024). Venture Capital & Private Equity: Fueling Startup Growth and Management (1st Ed., Pp. 1-267). Noble Science Press. https://doi.org/10.52458/9788198240637.nsp.2024.tb

Description

Venture capital (VC) and private equity (PE) have fueled the entrepreneurial ecosystem, which has developed as a pillar of economic growth and innovation. These investment vehicles are more than just financial tools; they are strategic facilitators that help startups at every stage of their journey, from conception to growth, management, and eventual exit. Venture Capital & Private Equity: Fueling Startup Growth and Management aims to provide a thorough grasp of the critical roles that VC and PE play in defining the startup landscape. The book begins with an introduction to venture capital and private equity, providing the groundwork and emphasizing the contrasts and synergies. It then delves into the VC and PE investment process, explaining how deals are identified, reviewed, and implemented. The Startup Funding Lifecycle chapter outlines the various funding stages, from seed and angel investments to growth-stage finance, and highlights the crucial role of investors at each level.

Managing Investments digs into the challenges of managing portfolios, assuring returns, and fostering positive investor-investor relationships. As startups develop, exit planning becomes increasingly important, and the Exit Strategies chapter delves into the subtleties of IPOs, acquisitions, and other exit methods. Private Equity and Venture Capital: Strategies, Sectors, and Emerging Trends also discusses emerging trends and sector-specific strategies, providing insights into investors' changing priorities, such as ESG factors and investments in emerging countries. The chapter on Venture Debt goes into great detail about this alternate funding method, which is becoming a popular complement to regular VC investments. Alternative Financing Models investigates novel mechanisms such as crowdfunding, revenue-based financing, and peer-to-peer lending that are changing the financial landscape for startups. Finally, Legal and Regulatory Aspects of VC/PE Investments investigates the legal frameworks, governance issues, and compliance requirements that are critical for sustainable investing operations.

This book is an excellent resource for students, professionals, and entrepreneurs looking to expand their understanding of venture capital and private equity. It seeks to bridge the gap between theory and practice by providing both practical and theoretical insights.

As the world recognizes the transformative power of entrepreneurship, the role of venture capital and private equity will remain critical. This book provides a framework for understanding and utilizing these dynamics to drive growth and innovation in an ever-changing economic landscape.

 

TITLE

PAGE NO.

CHAPTER:01

INTRODUCTION TO VENTURE CAPITAL AND PRIVATE EQUITY

1-31

 

  • OVERVIEW OF VENTURE CAPITAL AND PRIVATE EQUITY

2

 

  • DEFINITIONS OF VENTURE CAPITAL AND PRIVATE EQUITY
  • Venture Capital (VC)
  • Characteristics of Venture Capital
  • Private Equity (PE)
  • Characteristics of Private Equity

2

 

  • COMPARISON OF VENTURE CAPITAL AND PRIVATE EQUITY

10

 

  • IMPORTANCE OF VENTURE CAPITAL AND PRIVATE EQUITY

11

 

  • HISTORY AND EVOLUTION OF VC AND PE
      • Early Beginnings: The Foundations of Modern Venture Capital (VC) and Private Equity (PE)
      • The Birth of Venture Capital (1940s–1950s)
      • Growth of Private Equity (1960s-1980s)
  • Globalization and Expansion (1990s-2000s)

12

 

  • VENTURE CAPITAL DEVELOPMENT: ADOPTING NEW INDUSTRIES

18

 

  • PRIVATE EQUITY: STRATEGIES FOR DISTRESSED ASSETS AND SUSTAINABILITY

18

 

  • MAJOR STAKEHOLDERS IN VC AND PE ECOSYSTEMS
  • Limited Partners (LPs)
  • Role of Limited Partners (LPs)
  • General Partners (GPs)
  • Entrepreneurs and Founders
  • Essential Features of Entrepreneurs and Founders
  • Major Considerations for Entrepreneurs
  • Challenges Faced by Entrepreneurs
  • Investment Teams and Analysts
  • Critical Skills for Investment Teams

21

 

  • INVESTMENT TEAMS: THE BACKBONE OF VC AND PE OPERATIONS

31

CHAPTER:02

THE VC AND PE INVESTMENT PROCESS

32-64

 

  • INTRODUCTION- VC AND PE INVESTMENT PROCESS

33

 

  • DEAL FLOW AND SCREENING
  • Sources of Deal Flow
  • Referrals from Trusted Sources
  • Inbound Proposals
  • Accelerators and Incubators
  • Strategic Integration of Proactive and Reactive Approaches
  • Benefits of a Balanced Approach
  • Strategic Importance of Deal Flow and Screening

33

 

  • DUE DILIGENCE: LEGAL, FINANCIAL, AND MARKET ASPECTS
  • Legal Due Diligence
  • Financial Due Diligence
  • Market Due Diligence

45

 

  • VALUATION TECHNIQUES: PRE-MONEY AND POST-MONEY VALUATION

50

 

  • TERM SHEETS AND DEAL STRUCTURING
  • Components of a Term Sheet
  • Deal Structuring
  • Negotiation and Agreement
  • Significance of Term Sheets and Deal Structuring
  • Advantages of Well-Structured Term Sheets and Deals
  • Challenges in Term Sheets and Deal Structuring
  • The Importance of Addressing Challenges

51

CHAPTER:03

STARTUP FUNDING LIFECYCLE

65-97

 

  • THE STARTUP FUNDING LIFECYCLE: NAVIGATING THE PATH TO GROWTH
  • Growth of Startup Funding in India

66

 

  • STAGES OF STARTUP FUNDING
  • Seed Stage: Laying the Foundation for a Startup’s Growth
  • Objective of Seed Stage
  • Source of Funds
  • Characteristics of Seed Stage
  • Seed Stage Challenges
  • Early Stage Funding (Series A and B): Laying the Groundwork for Growth
  • Objective of Early Stage Funding
  • Source of Funds of Early Stage Funding
  • Major Features of Early Stage Funding
  • Early Stage Funding Challenges
  • Growth Stage (Series C and Beyond): Scaling for Sustained Expansion
  • Objective of Growth Stage
  • Source of Funds of Growth Stage
  • Major Activities of Growth Stage
  • Growth Stage Challenges
  • Late-Stage (Pre-IPO or Acquisition Funding): The Final Push to Exit
  • Objective of Late-Stage
  • Source of Funds of Late-Stage
  • Major Considerations of Late-Stage
  • Late-Stage Challenges

71

 

  • ROLE OF ACCELERATORS AND INCUBATORS IN VENTURE CAPITAL (VC) FUNDING
  • Incubators

83

 

  • ANGEL INVESTORS VS. VENTURE CAPITAL (VC) FUNDING
  • Angel Investors
  • Advantages of Angel Investors
  • Limitations of Angel Investors
  • Venture Capitalists (VCs)
  • Advantages of Venture Capitalists
  • Limitations of Venture Capitalists

87

 

  • STRATEGIES FOR RAISING VENTURE CAPITAL (VC) AND PRIVATE EQUITY (PE) CAPITAL

95

CHAPTER:04

MANAGING INVESTMENTS

98-126

 

    • INTRODUCTION - MANAGING INVESTMENTS
  • The Need for a Holistic Approach
  • Objectives in Managing Investments
  • Significance of Stakeholder Collaboration

99

 

  • BOARD REPRESENTATION AND MONITORING PERFORMANCE
  • Role of Board Representation
  • Investor Rights and Influence
  • Strategic Oversight
  • Accountability Mechanism
  • Performance Monitoring Tools
  • Challenges in Monitoring

107

 

  • PROVIDING STRATEGIC GUIDANCE AND OPERATIONAL SUPPORT
  • Strategic Guidance
  • Market Insights
  • Growth Strategy
  • Exit Planning
  • Operational Support
  • Talent Management
  • Technology Enablement
  • Supply Chain Optimization
  • Customer Acquisition
  • Collaborative Partnerships
  • Encouraging Collaborative Partnerships
  • Benefits of Collaborative Partnerships
  • Challenges in Collaborative Partnerships

113

 

  • CONFLICT RESOLUTION BETWEEN FOUNDERS AND INVESTORS
  • Nature of Conflicts
  • Conflict Resolution Mechanisms
  • Best Practices for Conflict Resolution

122

 

  • MANAGING RISK IN VC AND PE INVESTMENTS
  • Risk Identification
  • Risk Mitigation Strategies
  • Monitoring and Review
  • Dynamic Risk Management

125

CHAPTER:05

EXIT STRATEGIES

127-152

 

  • OVERVIEW OF EXIT STRATEGIES
  • Initial Public Offering (IPO)
        • Advantages of Initial Public Offering (IPO)
        • Challenges of Initial Public Offering (IPO
  • Mergers and Acquisitions (M&A)
  • Advantages of Mergers and Acquisitions (M&A)
  • Challenges of Mergers and Acquisitions (M&A)
  • Secondary Sale
  • Advantages of Secondary Sale
  • Challenges of Secondary Sale
  • Management Buyouts (MBOs)
  • Advantages of Management Buyouts (MBOs)
  • Challenges of Management Buyouts (MBOs)

128

 

  • FACTORS INFLUENCING EXIT DECISIONS

140

 

  • POST-EXIT CONSIDERATIONS FOR FOUNDERS AND INVESTORS
  • Founders
  • Investors
  • Company’s Future
  • Employees
  • Broader Implications

143

 

  • HIGH PROFILE CASE: SUCCESSFUL AND FAILED EXITS
  • Successful Exit: WhatsApp Acquisition by Facebook (2014)
  • Failed Exit: WeWork's Attempted IPO (2019)
  • Successful IPO: Tesla (2010)
  • Failed M&A: Yahoo’s Rejected Microsoft Offer (2008)

150

CHAPTER:06

PRIVATE EQUITY AND VENTURE CAPITAL: STRATEGIES, SECTORS, AND EMERGING TRENDS

153-184

 

  • INTRODUCTION

154

 

  • PE BUYOUTS AND LEVERAGED BUYOUTS (LBOS)
  • Definition PE Buyouts & Leveraged Buyouts (LBOs)
  • Characteristics of PE Buyouts and LBOs
  • Process of PE Buyouts and LBOs
  • Benefits of PE Buyouts and LBOs
  • Risks and Challenges
  • Major Trends in PE Buyouts and LBOs

154

 

  • SECTOR-SPECIFIC VC AND PE INVESTMENTS: TECH, HEALTHCARE, AND FINTECH
  • Technological Sector
  • Challenges in Technological Sector
  • Healthcare Industry
  • Challenges in Healthcare Sector Investments
  • Financial Technology Sector
  • Challenges in FinTech Sector Investments

159

 

  • SOCIAL IMPACT AND SUSTAINABLE INVESTING
  • Principles of Social Impact and Sustainable Investing
  • Drivers of Social Impact and Sustainable Investing
  • Major Sectors in Social Impact and Sustainable Investing
  • Challenges in Social Impact and Sustainable Investing
  • Role of Technology in Advancing Sustainable Investing
  • Impact of Sustainable Investing on Global Development

167

 

  • IMPORTANT CASE STUDIES: Successful & Failed LBO
  • Successful LBO: The Acquisition of Hilton Hotels (2007)
  • Failed LBO: The Acquisition of Toys “R” Us (2005)
  • Key Takeaways from the Case Studies
  • Implications for Future LBOs

181

CHAPTER:07

VENTURE DEBT

185-198

 

  • UNDERSTANDING VENTURE DEBT

186

 

  • FEATURES OF VENTURE DEBT

189

 

  • CHALLENGES AND RISKS OF VENTURE DEBT

193

CHAPTER:08

ALTERNATIVE FINANCING MODELS

199-233

 

  • INTRODUCTION

200

 

  • MODELS OF ALTERNATIVE FINANCING
  • Revenue-Based Financing (RBF)
  • Structure of Revenue-Based Financing (RBF)
  • Advantages of Revenue-Based Financing (RBF)
  • Challenges of Revenue-Based Financing (RBF)
  • Industries and Use Cases
  • Convertible Notes
  • Structure of Convertible Notes
  • Advantages of Convertible Notes
  • Challenges of Convertible Notes
  • Use Cases of Convertible Notes
  • Crowdfunding
  • Structure of Crowdfunding
  • Advantages of Crowdfunding
  • Challenges of Crowdfunding
  • Industries and Use Cases
  • Peer-to-Peer (P2P) Lending
  • Structure of Peer-to-Peer (P2P) Lending
  • Advantages of Peer-to-Peer (P2P) Lending
  • Challenges of Peer-to-Peer (P2P) Lending
  • Industries and Use Cases
  • Grants and Subsidies
  • Structure of Grants and Subsidies
  • Advantages of Grants and Subsidies
  • Challenges of Grants and Subsidies
  • Industries and Use Cases
  • Revenue Share Agreements (RSAs)
  • Structure of Revenue Share Agreements (RSAs)
  • Advantages of Revenue Share Agreements (RSAs)
  • Challenges of Revenue Share Agreements (RSAs)
  • Industries and Use Cases

200

 

  • THE ROLE OF FINTECH IN ALTERNATIVE FINANCING

229

 

  • BENEFITS OF ALTERNATIVE FINANCING MODELS

231

CHAPTER:09

LEGAL AND REGULATORY ASPECTS OF VC/PE INVESTMENTS

234-249

 

  • INTRODUCTION

235

 

  • VC/PE REGULATORY FRAMEWORK IN DIFFERENT JURISDICTIONS

235

 

  • CORPORATE GOVERNANCE IN VC AND PE INVESTMENTS

238

 

  • TAX IMPLICATIONS OF VC AND PE DEALS

240

 

  • ANTI-MONEY LAUNDERING (AML) AND COMPLIANCE CONSIDERATIONS
  • Implementation of AML Frameworks in VC and PE Firms
  • Challenges of AML Frameworks in VC and PE Firms

241

 

  • REGULATORY AND ETHICAL CHALLENGES IN VC AND PE INVESTMENTS

247

 

SUGGESTED READINGS & QUESTIONS

250-253

Dr. Balagouda S. Patil

More than two decades of experience in Teaching, Research and Consultancy in the areas of Decentralized Governance and Planning, Rural Development, Marketing Management and Corporate Social Responsibility. I have spent considerable time in the area of economic research having policy implications. Started my career as Research Associate and worked closely with eminent economists at various economics research institutes of repute where I was part of many funded and sponsored research projects funded by various national and international agencies such as IDPAD Netherlands, Ford Foundation, Asian Development Bank, Govt. of India, Various Ministries of State governments and Local bodies. The Institutes I am associated with include Centre for Multi-Disciplinary Development Research (CMDR) Dharwad, Institute for Social and Economic Change, Bangalore. Also, served at various capacities including Professor, Director of B-Schools. Conducted several workshops, conferences and professional enrichment programmes for working executives both in private and public sectors. Published several research papers in reputed peer reviewed journals (WoS/ABDC/Scopus). Also, visiting professor at Mzumbe University, Tanzania.

Dr. Shiva Johri

Dr. Shiva Johri is a Seasoned Academician with a total of Fifteen Years of Teaching Experience. He was awarded D.Litt in Management Discipline in November 2021 From Rani Durgavati University Jabalpur & was awarded Ph.D. in Management from Barkatullah University Bhopal in 2013. He did his Post Graduation in management from K.J.Somaiya Institute of Management studies & Research, Mumbai having specialized in Finance. He is currently working as Dean Academics & Professor at Oriental College of Management, Bhopal M.P.  He has taught Subjects in Finance & Management discipline like Working Capital management, International Financial management, Risk Management & Derivatives, Financial Engineering, Banking & Financial services, Security Analysis & Portfolio Management, Research Methodology, Quantitative Techniques in Management, Industrial Engineering& Management & Entrepreneurship etc. He has Several Certifications to his Credit & Has Authored Two Books, Chief Editor of Three Books & Several Book Chapters & Research Papers in Reputed Journals. He dedicatedly pursues work in academic discipline as means to serve the youth & society at Large.