Venture capitalists are normally financially well-off individuals, who either form a group, or who privately provide start-up, or seed funding, for new businesses. There are a number of reasons venture capitalists exist, and also a number of reasons why their necessity is being questioned by the onset of technology. Crowd funding is growing in popularity as an alternative source of capital. Also a number of companies do not have access to the equity markets. To be able to have your company publicly listed, the company must meet eligibility requirements. In the initial phases of organization, a company will likely not be able to meet those listing standards. Aside from seeking funding through venture capitalists, some business owners seek private funds by directly approaching people whom they deem possessing sufficient wealth to invest.
Companies seeking to be listed on the New York Stock Exchange (NYSE), a company must have over 400 shareholders, each holding at least 100 shares of stock. The company must also have at least 1.1 million shares of publicly traded stock, and the biggest, what some might call a barrier-to-entry, is the requirement that those publicly traded shares have a value over $40 million. Based on the share requirement, this means each share would have to have a trading value of at least $4 per share. One way a private company can conceivably raise money without using private funds is to issue a bond. Of course, either the yield would have to be quite high, or the balance sheet of the company rather solid. If a company is privately held, this does not necessarily mean they are cash-strapped, or having a dire need, but rather perhaps they might be looking for money just to grow. These bonds would be rated by Moody’s, the major bond rating firm, just like any other bond issue.
Venture capital started in the middle 1900s in the United States. The first successful venture capital-backed company was Fairchild Semiconductor, which also seems to have set in motion a trend we are still seeing today in Venture capital with money going to emerging technology companies. There are a number of venture capitalists today who have become very well-known based on providing seed funding to the likes of Facebook (Jim Breyer, Twitter (Peter Theil), and the cofounder of Paypal (Jerry Levine Many of these investors have invested in more than one of these start-ups, as in the case of Larry Levine, who was also one of the original Facebook investors.
The rich nature of financial markets, both domestic and international, are sponsored by the constant pipelining of new, publicly traded companies. But what about in Singapore. Golden Equator Capital is one of such Venture Capital in Singapore. They give new businesses funding that they desperately need to grow, and the growing popularity of alternative sources of cash like crowd funding aside, they continue to provide a much-needed lifeline, not only to businesses, but to the job market as well.