Venture capital fund

A venture capital fund is an investment fund that acquires stakes and business share in various promising businesses, i.e. it makes venture capital shares.

Behind a venture capital fund is a venture capital management company with professional expertise and exclusive right over investment decisions. The fund invests the capital collected from its investors in promising enterprises. The existence of these funds and the size of the capital they move can be interesting to companies because their operation increases the amount of capital that is available to them through venture capital investments that provide resources for the implementation of promising ideas and concepts.

The equity fund manager is interested in finding investors for his second, third and many planned funds. That is why he tries to achieve the best return on his investments, which also means that he usually actively participates in the management of the companies he buys. The capital fund manager must manage and record the assets of each venture capital fund separately from each other and from its own assets.

A venture capital fund can typically be created privately, as a closed-ended fund. This means that venture capital fund units issued by it cannot be redeemed before their expiry date. The private foundation also means that the venture capital units can only be marketed to a specific group of investors who have previously given a declaration of memorandum of understanding to receive the venture capital units that represent their investment. The venture capital ticket cannot be publicly traded. 

Venture capital tickets can be freely transferred, but the management rules of the venture capital fund may limit the transfer or stipulate that the transfer may require the consent of the venture capital fund manager or the unanimous or majority approval statement of the other investors.

Equity funds are characterized by the fact that, although the identity of the fund manager is known, the owners of venture capital fund units can remain anonymous, while any ownership structure can be created using the above options, and it can also be kept under control with transfer restrictions.