风险投资课程02

PrivateEquityandVentureCapitalLecture2:differenttypesofVCfirmsWhat‘Venture’meansinEnglish•Thewordventuremeansthefollowing:–a:anundertakinginvolvingchance,risk,ordanger;esp:aspeculativebusinessenterprise–b:aventuresomeact–c:something(asmoneyorproperty)athazardinaspeculativeventure–d:toexposetohazard:risk,gamble–e:toundertaketheriskanddangersof:Brave(venturedthestormysea)–f:toofferattheriskofrebuff,rejectionorcensure–g:toproceedesp.inthefaceofdangerThreemodelscomparisonVCand/orPEfirms•Thereareatotalof7differenttypesofVCfirmsinadditionaltoangelinvestors:–privateindependentventurecapitalpartnerships–privatesmallbusinessinvestmentcompanies–publicventurecapitalcompanies–venturecapitalsubsidiariesoflargecorporations–stateventurecapitalfunds–universityrelatedincubators&privatesectorincubators–investmentbankingfirmsOtherForms•Angelsorsmallinvestorsfindithardtogetintotoptierfund.•OtherformsofVCs:–investmentadvisor‘gatekeepers’–fundoffund–companionfund‘friendsoffund’–consultingfirms–privateplacementagencies•OtherPrivateEquityfunds,notVCs–LBOfunds–MBOandLBOVCnewinnovationsAntiTerrorismVCs•PatriotVentures,specializesinanti-terrorismtechnologiesforbusinesses--thingslikenetworksecurity,surveillance,andbioterrorismdetection.•Patriotaimstoraise$25millionfromLPsandmatchitwith$50millionfromSBIC.Thefirmwillinvestin15to20early-stagedealsoverthreeyears.Thatmayseemconservativeinanageof$1billionmegafunds•MorganStanleysurvey,thetopcorporatetechnologyspending:security•Governmentefforts:defenseandhomelandsecuritybudgetfor2003:$50Band$18.2B.PrivateindependentVCpartnership•Limitedpartnership:taxbenefits•10yearslife,2yearextension•TwotypesofPIP:–wealthyfamilies-venrockassociates,–institutionalinvestors--KPCB,•twotypesoffunds:usually$2-5million–traditionalvcfunds-investinginseed,orstartups–turnaroundorLBOsLimitedPartnerships•GeneralPartner-RaisesFundsforinvestinginnewventures-Unlimitedliabilitytolegalaction-Typicallyinvests1%ofthefund-Entitledto20%profits-Receivesmanagementfeeof2-3%peryearoncapitalundermanagement•LimitedPartner-Liabilityislimitedtofundsinvested-Entitledto80%ofprofitsGeneralPartners:HowtheirIncomestructured•Angelinvestors:managingandinvestingtheirownmoney•VentureCapitalists--GPs:managingandinvestingothersmoney•GPincome:–managementfees:1.5-2.5%ofthemoneytheymanaged,offices,telephones,computers,othercosts–Carriage:carriers--20/80.Now,it’shigher:25/75common.Even30/70VClimitedpartnership•limitedpartnerinvst99%profit75-80%generalpartnerinvst1%profit20-25%VClimitedpartnershiptheVCfundGPLPVCfirmsandVCfundsVCFirmVCfundVCfundVCfundVCfundVCfundVCfirmsandVCfundsVCFirmVCfundVCfundVCfundPC-2Pc-1PC-5PC-3PC-4OrganizationalStructureofVentureCapitalInvestmentGeneralPartners-Generateflowofdeals-Negotiatedeals-Screenopportunities-Monitorandadvise-HarvestinvestmentsPortfolioCompanies-Valuecreation99%ofInvestmentCapitalVentureCapitalFundCapitalAppreciation70-80%ofGainLimitedPartners-Pensionplan-Corporations-Endowments-Individuals-LifeinsurancecompaniesEffortand1%ofcapitalAnnualManagementFee2-3%CarriedInterest20-30%OfGainInvestmentCapitalandEffortFinancialClaimsAppendix:capitalcalls•Thefirmwillcollectorcalltheneededinvestmentcapitalfromthelimitedpartnerinaseriesoftranchescommonlyknownascapitalcalls.•Thesecapitalcallsfromthelimitedpartnerstotheventurefundaresometimescalledtakedownsorpaid-incapital.•Someyearsago,theventurefirmwouldcallthiscapitaldowninthreeequalinstallmentsoverathreeyearperiod.•Morerecently,venturefirmshavesynchronizedtheirfundingcyclesandcalltheircapitalonanas-neededbasisforinvestment.TheGPinvestment•UStaxlawformerlystipulatedthattheGPsneedtoinvestatleast1%tothePIP(privateindependentpartnership.•Buttwoexceptions:–1.FirsttimefundraisingisdifficultforLPtotrust,soGPusuallyinvestmore,alsogoodforachievingthe‘criticalmass’.–2.WealthyGPsmaywanttoinvestmore,eventhoughitmay‘crowdout’otherLPsTheagreementofPEpartnership-1•AgreementsbetweenLPsandGPs;•Fundsizes,investmentmaximumandminimum.•Numberofinvestors,GPcontributions•takedownschedule:bothGPandLPdonotliketopaythecommittedcapitalimmediately•firstamounttobedisbursedatclosing:10-33%,thedatesofthesubsequentpaymentsmaybesetintheagreement.TheagreementofPEpartnership-2•ThecontrolofLP:–if51%+LPagreecanreplaceaGP–GPcannotinvestinareabeyondtheirexpertise–nofaultdivorce•thecontrolofGP:–ifLPpaylate,alatefeeischarged–conditiononLP’ssharetransfersTheagreementofPEpartnership-3•Managementofthefund–sizeonanyoneinvestment,preventGPfromattemptingtosalvageapoorlymanagedinvestment–GPcannothaveanysharebeforeLPgetbacktheiroriginalcapital,GPshareasacalloption–percentageofthefundcanbeinvestedinonedeal–limitGP’sattempttoleveragethefund,limitthedebttoapercentage–limitGPtocoinvestbetweenfunds.GP’sattempttosalvagethetroubledinvestment–limitGPtoreinvestprofitsTheagreementofPEpartnership-4•GPactivities--5restrictions–1.RestrictGPtoinvestpersonalfundintothefirm,maypaymoreattention,maynotliketopulloutifnecessary–2.RestrictonGPtoselltheirsharesofthefundtoothers,reducetheincentiveoftheGPtomonitor–3.Restrictonfuturefundr