Venture funds in Ukraine. Best investment companies in Europe
Venture funds in Ukraine are in-demand financial instruments for aspiring entrepreneurs. Many startups start their lives thanks to venture capital funds.
Venture Fund – financial organizations that are engaged in inverting into new and unique startups. Priority is given to startups that can provide a high return on investment in the future. Venture capitalists invest in securities or shares of enterprises with a high or relatively high degree of risk. The main goal of these funds is the success of the company and the startup that a whole team of professionals is working on. As a rule, 70-80% of projects do not bring the expected return, but the profit from the remaining 20-30% pays for all losses. The venture investor does not seek to obtain a controlling stake, the necessary investments can be provided without guaranteed collateral.
Who is a Venture Investor?
Venture investors can be individuals and legal entities who have decided to invest in a company with high investment attractiveness. Also, an important element will be the rate of return on investment and development of the company.
The source of the investor’s income is the growth in the value of his share. The profit occurs approximately 3-7 years after the investment is made, when he decides to sell his share, which has increased compared to the initial value.
In fact, this is raising capital for several years (usually 4-6 years) in a company, which has a chance of rapid growth.
Venture capital in Ukraine
The forms of venture investment are quite diverse, but the specificity of Ukrainian post-privatization share capital dictates the predominance of investment loans – from investments in bonds specially issued for a project to direct investment lending through venture capital.
Most often, the function of venture capitalists in Ukraine is performed by asset management companies.
Funds do not pay income tax, and therefore, while the investor’s funds are in the fund, they give an increase, are not taxed by the state. The investor pays tax only after earning income through the sale of shares / investment certificates of the fund. Fund investors are co-owners of the fund, they receive all income from investments, excluding expenses related to the management of the investment fund.
The main areas of investment of venture funds: construction, trade, hotel and tourism business, agricultural processing, insurance, information technology.
A venture investment fund works as follows:
1. An investment fund issues its own securities – shares or investment certificates.
2. Investors buy the fund’s securities with money transferred to the fund’s bank account. Investors become owners of the investment fund.
3. An asset management company invests the investors’ money accumulated in the fund’s account in different types of financial instruments: shares of Ukrainian companies, corporate and state bonds, deposits and others, thereby forming the fund’s investment portfolio.
Venture capital funds in Ukraine are used to optimize asset management of financial and industrial holdings and reduce the tax burden, while venture capital investment (or investment of risk capital) in the world remains one of the most important sources of capital for companies whose rapid growth and development constantly requires additional external investments (as a rule, these are small and medium-sized businesses).
List of venture funds in Ukraine
AVentures is a fund that invests up to $2 million. Works in the fields of artificial intelligence, IT outsourcing, e-commerce.
Chernovetskyi Investment Group – invests in all sorts of startups, but for this it is necessary for the project to be really working. Invests in medicine, electronics and food technology.
Digital Future is an investment fund that requires your startup to grow rapidly. In other words, you need to show fast growth and profitability. Works in the direction: digital marketing, advertising, artificial intelligence, security, SaaS, marketplaces.
Genesis Investments is an investment fund that is ready to invest up to $5 million. He mainly works with startups that are engaged in mobile applications and machine learning technologies.
TA Ventures is a venture fund that is ready to invest in a running startup in the direction of medicine and mobile technologies.
Universal Commerce Group – works with projects in the following areas: e-commerce, fintech, biotech, online advertising, real estate and auto search and selection services, job search services, clothing search services, philantropytech projects.
U.Ventures is a venture capital fund working with startups related to medicine, machine learning and cybersecurity.
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