Venture Capital Financing - Venture Capital Financing Process

Venture Capital Financing Process

There are five common stages of venture capital financing:

  1. The Seed stage
  2. The Start-up stage
  3. The Second stage
  4. The Third stage
  5. The Bridge/Pre-public stage

The number and type of stages may be extended by the VC firm if it deems necessary; this is common. This may happen if the venture does not perform as expected due to bad management or market conditions (see: Dot com boom).

The following schematics shown here are called the process data models. All activities that find place in the venture capital financing process are displayed at the left side of the model. Each box stands for a stage of the process and each stage has a number of activities. At the right side, there are concepts. Concepts are visible products/data gathered at each activity. This diagram is according to the modeling technique founded by Professor Sjaak Brinkkemper of the University of Utrecht in the Netherlands.

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