Benefits Of Social Venture Capital Essay

Benefits Of Social Venture Capital Essay

Length: 1350 words (3.9 double-spaced pages)

Rating: Better Essays

Open Document

Essay Preview

Similar to venture capital funding, social venture capital also provides its share of advantages and disadvantages. If a social enterprise is considering social venture capital as a funding option, the following points are important to keep in mind.

The advantages of social venture capital

Many of the advantages of social venture capital are similar to venture capital. Enterprises are not only able to attract capital; they will also receive the experience of the investor. Social venture capitalists can provide guidance to these enterprises and therefore, guarantee they fulfil their potential quicker.

In addition, the social venture capital investment model offers a relaxed repayment model. As with traditional venture capital funding, the schedule to return the investment is flexible and businesses can focus on the essentials at the start.

Furthermore, social venture capital provides quick and sufficient funding to social enterprises. Socially responsible companies often focus on projects, which are both large scale and take time to implement. Social venture capitalists understand this point of view and are able to provide the initial capital to kick-start these projects.

But social venture capital adds additional advantages as well. Most importantly, the investment conditions are often better to traditional venture capital. As social venture capital doesn’t simply focus on the financial return, companies have more room to focus other goals, such as fulfilling the social or ecological goals.

Finally, social enterprises naturally would benefit from social venture capital due aligned interests and goals. Since both parties in the deal are aiming to earn money, as well as to create a social impact, it is easier to reach common ...

... middle of paper ...

...ade $46 billion sustainable investments in 2014. In 2015, one of the biggest destinations for social venture capital, India, saw these types of investments increase by 8%.

The shift is not simply in investment numbers, but also in investor attitudes. US Trust’s research highlights nearly 70% of millennials to consider investments as a way to express social and environmental values. The percentage of older generations, which agreed with this notion, hovered around 30%.

National governments have jumped on board with social venture capital. In the UK, the government proposed to provide a 30% tax relief for social venture capital trusts. Changes such as these are likely to enhance the attractiveness of social venture capital, for both the investors and the entrepreneurs. Social venture capital has the potential to help solve the big social dilemmas of the 21st century.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

The Basic Requirements For Successful Venture Creation Essay example

- The intention to create, knowledge of what is to be created and the confidence in creating and setting up a new venture, are the three basic requirements for successful venture creation. Creating ventures without relevant knowledge can be considered as reckless even when there exist a strong inclination and intention for venture creation. Thus, appropriate entrepreneurship education is a precondition for acquiring the right exposure, knowledge and intention about entrepreneurship (Shane & Venkataraman, 2000)....   [tags: Entrepreneurship, Entrepreneur]

Better Essays
920 words (2.6 pages)

Relationship Between Stakeholders And The Entrepreneur Essay

- The easy and trustworthy nature of crowdfunding is good for enhancing the relationship between stakeholders and the entrepreneur[s]. This relationship is necessary if the business is going to grow and operate within the confines of trust and ethical behaviors. The relationship between the stakeholder and the entrepreneur is explained using the Stakeholder Theory. According to Freeman, stakeholder theory is one that underscores the significance of each stakeholder (employer, employee, shareholder, suppliers, customers, community and the environment) to an organization as opposed to the shareholder only, the manner in which they are affected from a moral and ethical perspective (Freeman, et al...   [tags: Venture capital, Entrepreneurship, Finance]

Better Essays
864 words (2.5 pages)

Entrepreneurship And How It Affects The Economy Essay

- Rough Draft Entrepreneurship and how it affects the economy Entrepreneurship is great for the economic growth of one country. The numbers of entrepreneurs in one country have a correlation of the wealth of the country as it generates cash flow and creates jobs opportunity it also increase competition in the market. All this benefits the economy of the country and is the essence of capitalism. Entrepreneurs are responsible for a huge part of the small business sector and the small business sector is a huge industry by itself....   [tags: Entrepreneurship, Venture capital, Business]

Better Essays
1050 words (3 pages)

What Matters Most For You, And Why? Essays

- Essay A: What matters most to you, and why. What matters most to me is to be able to look back at any point in time throughout my life and feel proud and satisfied of my actions. I try to maintain a long-term view when making important decisions, which often requires hard work and sacrifices in the present in order to ensure long term benefits. Also, through my actions I try to deliver, whenever possible, a positive impact for the people around me. The origin of the importance I give to working hard today to achieve a better future outcome comes from the example of my parents who had meager incomes yet decided to work long hours to ensure that my brother and I could obtain the best educati...   [tags: Entrepreneurship, Venture capital]

Better Essays
1167 words (3.3 pages)

Characteristics of the Entrepreneur and Maximizing Opportunities for Innovation

- LEARNING OUTCOME (01) – CHARACTERISTICS OF THE ENTREPRENEUR Entry 1 Entrepreneurship is a process carried out by individuals by identifying opportunities and converting them into marketable products or services. Entrepreneur makes an investment, sets up an organisation, markets the product / services and makes profit from it. In my view, to be a successful entrepreneur, one must be confident, should be able to take calculated risk, flexible and creative. He should be able to lead his organisation to achieve his goal by ethical means (Schaper, Volery, Weber & Lewis, 2011)....   [tags: new venture opportunities]

Better Essays
965 words (2.8 pages)

The, Capital And R & D Resources Essay

- 3. Resources This section outlines the human, capital and R&D resources demanded by Wesfarmer in order to establish the new venture. 3.1 Human Resources Acquiring Holganix would require certain level of human resource input. While Holganix can be acquired as an entire package with its existing management and employees retained, it is predicted that challenges faced by Wesfarmer predominantly exist in exploring the new market in the United State. A typical example would be the problem of distribution in the host nation market....   [tags: Human resources, Labour economics, Innovation]

Better Essays
1058 words (3 pages)

Management Analysis : Venture Capital Management Essay example

- Management Summary Venture capital organizations provide funds for a variety of new business ventures and is a vital component of business creation. Venture capital acts as a catalyst for new business development and, more generally, economic growth, by providing budding organizations necessary start-up capital in exchange for either equity or debt. According to the National Venture Capital Association, venture capital investment over the past 30 years is responsible for the creation of more than 7.6 million jobs in companies generating over $1.3 trillion in revenues....   [tags: Venture capital, Investment, Finance]

Better Essays
1325 words (3.8 pages)

Intrinsic Compensation and Discretionary Benefits Essay

- Compensation and Benefit Systems Intrinsic Compensation and Discretionary Benefits Intrinsic compensation refers to ability of workers to gain pleasure from their accomplishments of their daily activities. This pleasure acts as their reward or compensation of what they have individually done. This has the effect of making the workers enjoy their tasks. On the other hand, workers sometimes receive rewards on top of their salary or wages. These rewards are not mandatory for one to receive. These kinds of additional rewards are referred to as Discretionary benefits....   [tags: Employee, Rewards, Work System]

Better Essays
1157 words (3.3 pages)

Essay about Australian Private Equity And Venture Capital Association Limited

- The Australian private equity industry is faced with plenty of turmoil. Funds have plenty of capital to deploy, but the competitive market is making it hard to find enough profitable acquisitions. On top of this, the fee structure is under scrutiny is Australia, just like it is elsewhere in the world. The above topics are surely one of the key debating points at the upcoming Australian Private Equity & Venture Capital Association Limited (AVCAL) conference this week. So, what do the numbers say about the current industry outlook....   [tags: Stock market, Venture capital, Australia]

Better Essays
1003 words (2.9 pages)

An Overview of Nigerian Venture Capital and Private Equity Essay

- An Overview of Nigerian Venture Capital and Private Equity Executive Summary Nigeria is facing an uncertain future as outbreaks of ethnic and religious violence continue to place strains on Africa’s most populated country. With the 2003 elections approaching, the continuing battle amongst incumbent politicians and between competing ethnic and regional groups is likely to intensify. Such an environment will test Nigeria’s fragile democracy, which has never witnessed a hand over from one civilian government to another....   [tags: Nigeria Finance Venture Capital]

Free Essays
1803 words (5.2 pages)