Venture capitalists and angel investors provide financing for new companies and startups. Venture capitalists invest through venture capital funds and expect high returns, while angel investors are wealthy individuals who invest their own money. Both help finance companies in exchange for equity and provide guidance to help the businesses grow. The document discusses definitions of venture capitalists and angel investors, their roles and characteristics, the investment process, risks involved at different stages, and differences in these fields between regions like the United States, United Kingdom, Russia, Asia, and India. It also lists some of the top venture capital firms and angel investors active in India.

1. Venture Capitalist
and Angel Investors
Presented By:- Aqib ali
Owais siddiqui
JAMIA HAMDARD UNIVERSITY

5. Definition by SEBI
• The SEBI defined Venture capital fund in its regulation 1996 as a fund
established in the form of a company or trust which raises money
through loans, donations, issues of securities of units as the case
maybe and makes or proposes to make investments in accordance
with regulations

6. Need of venture capital
• To bridge the gap between capital knowledge
• Maximum utilization of available resources

7. Who is venture capitalist ?
• A venture capitalist is a person or investment firm that makes
venture investments and these venture capitalists are
expected as well as capital to their investments.

8. Characteristics of VCs
• Well managerial skills
• Well knowledgeable
• Sophisticated investors-Comes forward to take risks
• Decision making ability
• Analyzing skills

9. Services generally provide by VCs
• Finance to new and rapidly growing firms
• Finance to typically knowledge based sustainable up scalable
companies
• Purchase equity and quasi equity securities
• Assist in the development of new products or services
• Add value to the company through active participation

10. Roles within a venture capital firm
• Venture capitak general partners-Also known in this case as
“Venture Capitalist of thr firm
• Investors in venture capital funds are known as limited
partners.
• Venture partners bring in deal and receive income only on
deal they work on.

11. Advantage of venture capital
Economy
oriented
Investor
oriented
Entrepreneur
oriented

12. Disadvantages of venture capital
• Lengthy and complex process
• Deal in the negotiation stage.
• Investors becomes parts of owners business.

13. Risk Stages

14. Risk stages

15. Venture capital process

16. VC industry wise segmentation

18. What is an angel Investor
• A wealthy individual willing to invest own money in a business
start-up
• Angel investor was first used by Willam Wetzel .
• An angel investor or angel (also known as a business
angel, informal investor, angel funder, private investor,
or seed investor) is an affluent individual who provides capital
for a business start-up, usually in exchange for convertible
debt or ownership equity.

19. Investment Profile
• Angel investments bear extremely high risks and are usually
subject to dilution from future investment rounds. As such,
they require a very high return on investment.
• A large percentage of angel investments are lost completely
when early stage companies fail, professional angel investors
seek investments that have the potential to return at least ten
or more times their original investment within 5 years,
through a defined exit strategy, such as plans for an initial
public offering or an acquisition.

20. Investment Profile Contd…
• Current 'best practices' suggest that angels might do better setting
their sights even higher, looking for companies that will have at least
the potential to provide a 20x-30x return over a five- to seven-year
holding period.
• The actual effective internal rate of return for a typical successful
portfolio of angel investments is, in reality, typically as 'low' as 20–
30%.

21. Geographical differences
United States
• United States angel investing, receiving 39% of the $7.5B
invested in US-based companies throughout Q2 2011, 3–4
times as much as the total amount invested within New
England.
• Total investments in 2011 were $22.5 billion, an increase of
12.1 percent over 2010 when investments totalled $20.1
billion.
• Angel investors are not only responsible for funding over
67,000 Start-up ventures annually, but their capital also
contributed to job growth by helping to finance 274,800 new
jobs in 2012. In 2013, 41% of tech sector executives name
angel investors as a means of funding

22. Geographical differences Contd…
United Kingdom
• A study by NESTA in 2009 estimated that there were between 4,000
and 6,000 angel investors in the UK with an average investment size of
£42,000 per investment. Furthermore, each angel investor on average
acquired 8 percent of the venture in the deal with 10 percent of
investments accounting for more than 20 percent of the venture.
• In terms of returns, 35 percent of investments produced returns of
between one and five times of the initial investment, whilst 9 percent
produced returns of multiples of ten times or more. The mean return,
however, was 2.2 times investment in 3.6 years and an approximate
internal rate of return of 22 percent gross.
•
the UK, with the average number of investments made by angels at 5,
compared to 2.5 in 2009. The same report also found an increase in
angel investors making impact investments, with 25% of angels saying
they had made an impact investment in 2014

23. Geographical differences Contd…
Russia
• In 2012, the 'International Business Angels Assembly' took
place in the Russian Federation. This was an exclusive event
devoted to private investing into innovative projects in Eastern
Europe.

24. Geographical differences Contd…
Asia
• Fifteen years ago, it was difficult for startups in China to find
local angel investors, but that has changed. Angel groups such
as Angelvest needed to be created from scratch by David Chen
and media executive Ted Lai. Billionaire tech entrepreneur and
grassroots investor Cai Wensheng also founded Long Neck
Investments.

25. India Angel network achievement
• Largest Angel investor group spread PAN India geographically
in mumbai delhui pune banglore.
• +125 active Angel investor from across india and overseas.
• Concept has found resonance with corporate like IBM,
venture fund like SIDBI,IVP,RVCF etc.

26. India Angel network achievement
• +22 investments made to date acprss multiple sectors
• +250 deals received per month pan india bases
• Co investment with Sequoia Capital in Dhruva
• Member of world business Angel investor Association

27. Some IAN Portfolio companies

29. Difference

30. Top VCs in India
• Helion Venture Partners.
• Accel Partners.
• Blume Ventures.
• Sequoia Capital India.
• Nexus Venture Partners.
• Inventus Capital Partners.
• IDG Ventures.
• Fidelity Growth Partners.

31. Top Angel Investor in India
• Rajan Anandan:
• Anupam Gopal Mittal:
• Sanjay Mehta:
• Zishaan Hayath:
• Sharad Sharma:
• Anand Ladsariya:
• Sunil Kalra