Venture Capitalists: What roles do they actually perform in their portfolio companies….

Venture Capital, Funny, Pictures, Private Equity, Roles, Management, Leadership,

Is value creation by Venture Capitalists a reality or myth?….

Whatever it is… there is no denying the fact that Venture Capitalists and Private Equity players have facilitated creation of industries …. accelerated emergence of new age business and led to creation of new breed of entrepreneurs… Here are some of the roles and responsibilities which a VC typically plays across functional areas of a organization in the hopes of a ‘HOME RUN’ blockbuster exit….

Broad functions Roles and Functions of Venture Capitalist in Portfolio Companies
Formal roles Informal roles
Board of director Member
Sounding board
Observer rights
Strategic functions Formulating business strategy Strategy sessions
Managing crises and problems Business advisor
Boundary spanning Selecting vendors and equipments Developing professional support group
Source of professional contacts
Source of Industry contacts
Finance related Obtaining alternative sources of financing
Interfacing with investor group
HR related Management Recruiter (Interviewing and selecting) Searching for candidates of management team
Negotiating employment terms with candidates Motivating personnel
Replacing management personnel
Marketing related Formulating marketing plans Soliciting customers or distributors
Testing or evaluating marketing plans
Operations related Developing actual product or service
Developing production or service technique
Supervisory Monitoring financial performance Phone calls
Monitoring operating performance Non board meetings
Seeking periodical reports
Interpersonal Friend / Confidant
Mentor / Coach

More on the VC here….

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