7.1. Equity Investment as a Process: Organization and Management
Equity investment satisfies two different needs: (1) companies collect funds because their entrepreneurs do not have sufficient financial resources to support and increase the development of their businesses and (2) these financial resources are held by investors who finance high-risk high-reward projects.
Equity investment can be developed through vehicles that allow institutional venture capital activity. These funds are split up between different companies that are potential sources of high economic return.
Different vehicles for investment activity include:
- Partnership — Shareholders are responsible for the management of the private equity fund and they respond directly ...
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