Informal Venture Capital

Small businesses in virtually all industrialized countries find it increasingly difficult to obtain finance from institutional sources. Banks have become more risk averse; venture capital funds, previously of only marginal significance, are now often concentrating their investments on established companies; and management buyouts and buyins and pressures to reduce government spending have resulted in a reduction in public policy initiatives. In this context there is a growing interest in the role of the informal venture capital market as an alternative source of risk finance for small business. Informal Venture Capital: Investors, Investments and Policy Issues in Finland investigates the phenomenon of ‘business angels’ – wealthy private individuals who invest in small businesses – who are increasingly recognized throughout the developed world as representing the most important source of venture capital for entrepreneurial businesses in their start-up and early growth stages. This volume answers key question