Globalisation and Indian venture capital system

Abstract

Though the modern concept of venture capital started in USA with the formation of American Research & Development Corporation in the year 1946 by Gen. Georges Doriot, a French-born military man who is generally considered as "the father of modern venture capital"; the concept of venture capital has been successfully transplanted (either in the original form or in variation) to almost all parts of the world over a period of 50 years. Presently venture capital industry became an integral part of the financial sector on par with the conventional financial institutions in many of the countries because of its ability to promote entrepreneurial advancement and developing the economy in a manifold way. The impact of globalisation around the world helped the venture capital industry to move further ahead. The benefits of venture capital financing can be seen in many advanced countries in the form of large scale industrial development, increased employment opportunities, higher turn over as well as revenue generation to the government, more and more investments in research and development, and also manifold increase in export of goods and services. This being the case Asia Pacific region occupies only third position on a global scale after North America and Western Europe. The market leader in Asia Pacific region is Japan and India is in the 12th position. The growth and development of venture capital activities during the last 7 years indicates a gradual slow down, but the venture capital players anticipate the possibility of a bright future. This trend is applicable to India also.