An equity fund is an instrument for long-term financing, which provides capital resources to businesses, with the goal of augmenting their management and therefore its value. The fund's resources are temporarily invested firms deemed attractive, receiving generally a percentage of equity. These financing vehicles collect savings with the aim of generating capacity that allows several individuals and institutions to efficiently acquire significant resources in order to finance productive wider and longer terms projects. These individuals or firms are called investor and generally expect a return on their investment than traditional investments.
In the Capital Funds, an individual or a firm is responsible for performing the analysis of companies and whether they have the appropriate characteristics for investment. In fact, they check their potential to grow and create value. This growth capital company checks that the prospects meet the investment profile established by investors. In addition, the funds given to companies contribute in money, knowledge, experience and connections, which are better known as Smart Capital. Therefore, this source of funding is not limited solely to deliver resources expecting some return, while management also contributes to maximize the value of the invested company.
Future and Uncertainty of the Growth Capital
Funds focused on investing in growth or expansion of businesses is usually based on growth capital. These companies are at an important level of maturity as funding is focused on increasing production capacity, develop new products, and strengthen the marketing strategy as well as working capital. It has long been forced to abandon the idea of a stable future given the continued emergence of radical and surprising changes of high impact, which sometimes led to adopt an alarmist position in relation to private equity or growth capital funding. As the future is conceived ...