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May 08

The Purpose Of Corporate Finance, Venture Capital, Reverse Mergers, Ipos, Angel Investors

In the field of venture capital, corporate finance and the like, we sometimes lose sight of the goal of our efforts.

We can easily see that it does not matter how the money is raised; there must be a fair exchange for the team, for the technology, and for the money.

The real goal of corporate finance is to see that the company has more than enough money to achieve its goals.

Now that we say it, we know it could not be anything else. What else could it be?

In seeing this, we know immediately what venture capital is not.

Real venture capital does not deprive the company of funds so it can be bought for a song later on, taking the work of the team for little or nothing.

Venture capital is not loading the entrepreneurial team down with straightjacket agreements.

Venture capital is not setting a cheap value on the company so you can make a huge gain out of a share of the company that should belong to the people that daily contribute their sweat.

The real purpose of capital is not to take control of the company away from those who best know how to run it. The real purpose of the capitalist is not to second guess management. Management, not capital, is on the firing line and best knows how to achieve the goals of the company.

True corporate finance is seeing that the company has more money than it needs. True venture capital motivates and encourages the team. True venture capital values the team and acts accordingly. True venture capital is part of the team.

True corporate finance is more than capital. It is a partnership of equals; it is support that is more than financial; It is on the tam that shoulders the burdens and fights the fights.

Only true venture capital is entitled to share in the rewards of the team.

When a company is adequately financed, the entrepreneurs and their team are not deprived of enough pay to support themselves and their families. They are well rewarded for their work by industry standards. They are not deprived of pay or working for a pittance so that the venture capitalists can have a larger return on their money.

A company only has enough money when it has enough money to meet the unknown.

A company with good finance can afford those things it needs to win in the combat of business.

True venture capital provides these resources.

The real goal of any venture capital is to see that the company has more than enough money to achieve its goals.

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