HOT |
NOT |
| Structured venture capital financing |
Traditional loan financing |
The correct approach to venture capital business (bringing together its three components – matching the right kind or kinds of financing with the right projects with the right corporate expertise and resources ) to ensure that investments are sustainable |
External mechanisms to ensure investments are sustainable |
Networks that unlock future growth and generate future income |
Organizations that stifle potential, growth, autonomy, accountability and ethics |
Cooperation between professionals and organizations who remain autonomous |
The full-time employment contract |
Corporate network associations that protect members’ privacy and integrity |
Networks that allow unrestricted access to their members |
Quantifying risk; a managed, negotiated and facilitated venture capital process |
Blaming high risk, business plans, contracts or suppliers for project failure |
Understanding how venture capital business works |
Applying portfolio theories to investment, rather than business principles |
Strategic alliances; growing projects; building venture capital intellectual infrastructure; to fulfill a project’s requirements |
Narrow self-interest, fragmentedness, profit at all cost
|
An optimistic, long-term view of venture capital business, compensating for downturns |
A sceptical, short-term view of venture capital business, focusing solely on the balance sheet |
Strong value propositions, long term thinking |
Weak value propositions, short term thinking |
| Recognizing that venture capital development is crucial to economic growth; governments seeking to attract investors who are serious about communities and environments |
Not recognizing that venture capital development is crucial to economic growth; anti-business stance by governments |
Facilitating assistance and support to governments, companies and entrepreneurs |
Development at the expense of infrastructural needs |
Committed capital; shared risk; shared interests; responsible development; financial, intellectual and business growth |
Hit-and-run investment, profit at all cost
|
Wanting political solutions, reform |
War, political intransigence |
Governmental support to help create environments conducive to sustainable development |
Government interference or inconsistency – primary causes of risk and loss |
Doing business where political and economic systems work |
Doing business where governments require kickbacks |
Establishing sound property rights and property acquisition procedures |
Undermining property rights; unnecessarily bureaucratic property acquisition procedures |
Corporate values, constitutions and codes of conduct and ethics |
Mere compliance |
Closeness of management to markets |
Remoteness of management to markets |
Up-to-date information and research on venture capital business and markets |
International sentiment |
Seeing government interference and inconsistency as a global problem |
Seeing government interference and inconsistency as a problem only in developing countries |
Seeing investments in developing countries as calculated risk, high gains |
Seeing investments in developing countries as high risks, high gains |
Focusing on take-up |
Focusing on need |
Shared risk |
Project managers who are unwilling or unable to commit to initial costs |
Limited, researched exposure to new technologies |
Overexposure to new technologies |
Investing in young tech-based companies with high differentiation that have been able to raise funds in the present environment |
Investing in young tech-based companies with low differentiation that have not been able to raise funds in the present environment |
Floating companies near break-even point |
Floating companies with insufficient revenues |
Multilateralism in venture capital business |
Unilateralism in venture capital business |
Access to a multitude of markets |
Being limited to one over-traded, under-capitalized market |
