A look at venture lease investments

Venture capitalist investment dollars account for billions and billions of company start-up funds.And that number rises by an average of $19 billion dollars a year according to Pricewaterhouse Coopers.The fact that 2,500 high growth companies have been given funding by venture capitalist alone has brought significant attention to this investment option.Out of venture capital investing has risen a new type of investment, venture leasing.

What is venture lease investing?

Venture lease investing is the investing of start-up funds for company equipment.Venture lease investors invest specifically in a company by lending them some of their equipment start-up costs such as for computers, furniture, telephones, and equipment for projects that will help the company grow such as through a Research and Development team.This expanding investment market is getting a lot of attention and it gaining momentum in terms of the number of investors who are willing to designate that their investment dollars be spent in this particular market.

Who helps support venture leasing?

Venture leasing is most popular among institutions and very wealthy individuals.Some of the types of institutions fueling the venture lease market are CPA firms, banks, attorneys, investment banks and consultants.These institutions offer the services necessary to promote and support the venture leasing market.New technologies and business concepts are also being developed in order to expand and provide promotion for the venture leasing expansion.

Why choose to venture lease instead of venture capital?

Venture capitalists have long experienced significant prosperity when wise investment choices are made.So why would an investor choose to invest in venture leasing and not as a venture capitalist?The answer is that venture capitalists must invest a great deal more.Venture capitalism is also more risky as there is more at stake.In turn the venture capitalist could make as much as 35% on their investment or they could loose everything.A venture lease investment requires a less sizeable contribution and carries with it lower risk.Venture leasers usually see a return between 17-55%.Those who invest in venture leasing lessen or mitigate their risk by having a security interest in the equipment itself and accounting for amortization and depreciation in their transactions.Obviously borrowers are pleased to have this sort of financing available to give them the start that they need in the business world.

What is some good advice for a beginner at venture lease investing?

When you are considering worthwhile candidates for venture lease investment there are two factors that when considered can help you a great deal with your decision.First look into the strength of the start-up company's management team.Obviously, you will not want to invest in a company that you do not believe has the attributes needed for success financially.To judge their strength you may want to request a business plan and ask them some specific questions.The second thing to look at when considering whether or not to venture lease invest is to take a look at the venture capital investor for the company.You can take a lead from that capital investor to understand if they have any concerns and to ask them why they decided to invest in this particular company.You will also need to make some decisions regarding the type of venture capital investing that has been set up.Generally it is a good practice to have different periods of time where money is dispersed.In other words it could be worrisome for the venture lease investor if the venture capital investor did not have sufficient funds to give the company down the road.A venture capitalist who has exhausted their funding can mean bad news for the venture leaser.