Venture investors and startups: mutually beneficial cooperation
Large international corporations, in recent years, have been very actively attracting various startups to their business. After all, the innovations that are the foundation of any startup can lead to success for large corporations. Over the past two decades, the highest global level of activity has been recorded in the field of venture investment, which indicates a high level of demand for new ideas, solutions and products.
Connecting startups with corporations provides the first with useful connections, resources, market expertise, and also generates income. Cooperation between the two worlds is in many cases mutually beneficial.
As a rule, international investors want to participate in fewer transactions, but with larger volumes, investing in ready-made businesses at later rounds when the success of a business idea is obvious. Therefore, it is important for companies wishing to obtain venture financing to prove their viability. If we are talking about small amounts of investment, then for startups who are looking for funds even in the early stages, there are plenty of opportunities.
Representatives of venture capital funds have repeatedly stated that they underestimated the importance of the technological component in valuing assets, which led to unforeseen difficulties after the transaction, as well as in the sale of the asset. In order to avoid such problems, an assessment of operational and technological risks should be carried out at an early stage.
At the same time, investment funds are focused on maximizing the benefits of their investments in transactions. However, if the buyer does not fully understand the specifics of the acquired asset, then there is a risk of incorrect assessment of its value. The specifics of a business may relate to both the operational risks of a company and the risks associated with the use of information technology.
Venture industry and venture business in Ukraine is just beginning to develop. Venture investors in Ukraine today are, first of all, venture funds and investment companies, business incubators and accelerators, business angels and serial entrepreneurs. Given that the Ukrainian venture market is characterized by a limited number of professional players and a shortage of venture capital, the demand for attracting venture capital investments is quite high today.
And now we can say that cooperation between large corporations and start-ups not only works, but also brings tangible benefits to all participants in the process.