November 2009
Beginner
368 pages
11h 24m
English
It is difficult to control a venture capital operation because of information asymmetry between the entrepreneur and management. The best way to safeguard the transferred capital is to involve the venture capitalist in the management of the company. With their own people exercising control over the Board of Directors, it permits the institutional investors to participate in key decisions connected with suppliers, market policies, extraordinary financial operations, and ordinary management of the company. The theory of the financial intermediary labels this type of monitoring as “soft facet” and “hard facet.” Soft facet monitoring merely supports management regarding principal operating ...
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