Trends in the Indian Venture Capital Industry. To study the current Indian scenario.

To find out the different contributors to the Indian Venture Capital Industry and their investment industry wise. To identify the major players in the Indian Venture capital Industry. To identify the problems faced by the Indian venture Capitalists. To study the various guidelines of the regulatory body SEBI.

RESEARCH DESIGN : Exploratory research. The major purpose of this research is description of state of affairs as it exists at present.

DATA TYPE: Secondary Data. Secondary data is the data which is already collected by someone and complied for different purposes which are used in research for this study. It includes:Internet Magazine Journal

Venture capital means funds made available for startup firms and small businesses with exceptional growth potential. Venture capital is money provided by professionals who alongside management invest in young, rapidly growing companies that have the potential to develop into significant economic contributors.

venture capital (VC) is financial capital provided to early-stage, high-potential, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as biotechnology, IT, software, etc.

Long time horizon Lack of liquidity

High risk
Equity participation Participation in management Provided at earlier stages Finance to smaller and less mature companies

To bridge gap between Capital and Knowledge. Maximum utilization of available resources.

Finance to new and rapidly growing companies Finance to typically knowledge based sustainable, up scalable companies. Purchase equity/quasi equity securities. Assist in development of new product or services. Add value to the company through active participation.

It provides a strong capital base for future growth by injecting long term equity finance. The venture capitalist is a business partner, sharing both the risks and rewards. Venture capitalists are rewarded by business success and the capital gain. Provides practical advice and assistance to the company based on past experience with other companies.

Network of contacts Provides additional source of funding Venture capitalists are experienced in the process of preparing a company for an initial public offering (IPO) of its shares onto the stock exchanges or overseas stock exchange such as NASDAQ Facilitates sale trade

VCFs in India can be categorized into following five groups:

1)

Those promoted by the Central Government controlled development finance institutions. For example: - ICICI Venture Funds Ltd. - IFCI Venture Capital Funds Ltd (IVCF) - SIDBI Venture Capital Ltd (SVCL)

2) Those promoted by State Government controlled development finance institutions. For example: - Punjab Infotech Venture Fund - Gujarat Venture Finance Ltd (GVFL) - Kerala Venture Capital Fund Pvt Ltd. 3) Those promoted by public banks. For example: - Canara bank Venture Capital Fund - SBI Capital Market Ltd

4) Those promoted by private sector companies. For example: - IL&FS Trust Company Ltd - Infinity Venture India Fund 5) Those established as an overseas venture capital fund. For example: - Walden International Investment Group - HSBC Private Equity - management Mauritius Ltd

IT and IT enabled services. Software products. Banking Media/Entertainment. Bio Technology Pharmaceutical Retail. Electronic Manufacturing.

A number of people in India feel that financial institution are not only conservatives but they also have a bias for foreign technology & they do not trust on the abilities of entrepreneurs. It injects long term equity finance which provides a solid capital base for future growth. Some venture fails due to few exit options.