StartUp Capital Ventures Harvard Case Solution & Analysis

John Dean and Danny Louis began raising its first fund as StartUp Capital Ventures (SCV), a small venture capital firm, in 2005. Together with four other "Managing Member" of the company, they intend to focus investments on early stage software companies with a capital efficient business models. SCV was looking for organizations with an initial pre-money assessment is less than $ 5 million. Our philosophy is to target companies that already have a product or service income and that could show a reasonable likelihood of immediate ROI SCV's. In the process of raising funds, Charlie Eubanks, "anchor investor" for a young company, the pressure on the founders to devote 30% of SCV capital investment in China. The country was a compelling place to invest in many ways. China's GDP grew by 10% per year, mainly due to the annual growth of the private sector by 20%. Tax burden was light - no capital gains tax. In addition, seven times more engineering students graduate from college every year in China than in the United States. However, Dean and Louis (who was born in Hong Kong) were also aware of the significant disadvantages of investing in the region. Addresses some of these issues as they relate to two colleagues attempted to answer questions: whether to enter the market at all, and whether to invest in Zero2IPO, Beijing research firm that tracks the Chinese mainland private equity and venture capital markets. "Hide
by John Glynn, Peter Ziebelman, Bethany Coates Source: Stanford Graduate School of Business 13 pages. Publication Date: February 2, 2007. Prod. #: E247-PDF-ENG

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