Annexure-V- Cover Page for Academic Tasks

Course Code: MKT 352 Course Title: Selling and Sales Management

Course Instructor: Dr Veer P Gangwar

Academic Task No.: 01 Academic Task Title: FINSIGHT

Date of Allotment: 16/08/2020 Date of submission: 31/08/2020

Student’s Roll no: A055 Student’s Reg. no: 11815356

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students as specified at the time of assigning the task by the instructor)

Learning Outcomes
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student’s work or from any other source except where due acknowledgement is made
explicitly in the text, nor has any part been written for me by any other person.
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 Selling and Sales Management
MKT 352
Submitted by:
KIRAT SINGH BHATIYA
Registration no.: 11815356
In partial fulfillment for the requirements of the award of the degree
of

BACHELOR OF BUSINESS ADMINISTRATION

“Mittal School of Business”

LOVELY PROFESSIONAL UNIVERSITY

Phagwara, Punjab.

FINSIGHT
 INTRODUCTION

Venture capital refers to the finance provided by venture

capitalists, who invest in relatively new, high growth
companies or startups that have a possible to growth and
develop into highly profitable ventures. It has-high risk and
high-return personality. So, it acts as an important source of
finance for entrepreneurs with new ideas. in keeping with
SEBI regulations, working capital fund means a fund well-known within
the variety of an organization or trust, which reinforces
money through loans, issue of securities, or donations and
makes or proposes, to create investments in accordance with
these regulations. The funds so collected are available for
investment in potentially highly profitable projects at a high
risk of monetary loss. A speculator is a private or a corporation who provides
Investment Capital, Intellectual, Management Expertise, Networking &
marketing support while funding and running highly innovative & prospective
areas of products likewise as services. Thus, the investments
made by Venture Capitalists consisting; Financing new and
rapidly growing projects, enterprises or companies, Buying equity and other
securities, Taking high risk expecting high
return on investment, Having an extended frame of your time period,
normally of quite 5 to six years and Marketing and promotions of the
merchandise /service being obtainable.

A working capital company is defined as a financing institution which joins an

entrepreneur as a co-promoter in a very project and shares the risks and rewards
of the enterprise. During this case as "venture capitalists"
or "Venture Capitalists") are the executives within the firm, in other words the
investment professionals. Typical career backgrounds vary, but many are
former
chief executives at firms like those which the partnership finances and other
senior executives in technology companies.

Investors in working capital funds are called limited partners. This constituency

comprises both high net worth individuals and institutions with large amounts
of
available capital, like state and personal pension funds, university financial
endowments, foundations, insurance companies, and pooled investment
vehicles,
called fund of funds.
PROBLEMS
1. VCF in India haven't prioritized high-tech thrust areas for venture
financing. The prioritization of thrust areas may facilitate development
for technological specialty and expertise by VCFs.

2. VCFs, even the State-level institutions, lack regional focus. A

regional
focus can lead efforts and specialization and also it can help in taking of
full advantage of the regional benefits.

3. All funds offer funding for early stage activities, viz. seed capital and
startup financing. However, all start-up companies don't get capital
because of the perceived high risk. Similarly financing for expansion
and
rehabilitation of sick units is lacking in spite of concessions available
under the government guidelines.

4. the main focus of VCF in India is on technology financing and rightly

making Indian Industry globally competitive. But given the
requirements of India in terms of high production and productivity and
employment, VCF should adopt a broader approach in financing and
supporting novel ideas of entrepreneurs, which may not necessarily be
high-tech in nature.

5. The innumerable financial instruments with different combinations of

risk and return characteristics available within the developed countries
enable the venture capitalists to tailor flexible financial packages to the
entrepreneur’s needs. thanks to the paucity of economic instruments in
India, such flexibility isn't available.

6. Private sector funds have contributed significantly to the expansion of

the venture capital within the developed countries. Till recently,
however, the government policy in India failed to encourage
participation of the domestic private sector within the risk capital. Even
now the share of the private funds in working capital is kind
of negligible.

7. The scope of working capital operations in India is restricted to

providing financing for seed capital, high-tech projects and turning to
R&D into commercial production. This focus is certainly most
desirable in an exceedingly developing country like India. However;
VCFs in developed countries provide assistance under a range of
situations, starting from supplying 226 seed capital to financing
expansions, buy-outs, mergers and acquisitions
etc. They also don't necessarily equate high-risk with technology
products. The fiscal and other incentives for venture finance are
available
for all risky ventures within the developed countries.

8. In India there's an absence of “Experienced Management Team”. this

is often the major obstacle within the growth of risk capital Funds in
India.

9. At present, capital Funds are often structured as trusts or companies

in order to be eligible for registration with SEBI. Internationally, limited
partnerships, indebtedness partnerships and financial
obligation Corporations have provided the required flexibility in risk
sharing, compensation arrangements amongst investors and tax meet up
with. Therefore, these structures are commonly used and widely
accepted globally specially in USA. Hence, it's necessary to supply for
alternative eligible structures.

10. The regulatory, tax and legal environment isn't playing an enabling

role. This also underscores the facilitating and promotional role of
regulation internationally; venture funds have evolved in an
environment of structural flexibility, fiscal neutrality and operational
adoptability. There is no regulatory simplicity and structural flexibility
on the identical lines.

SALES PLAN

Solid Management

Quite simply, management is far and away the foremost important factor

that smart investors take into consideration. VCs invest during
a management team and its ability to execute on the business plan, first
and foremost. they're not searching for "green"
managers; they're looking ideally for executives who have successfully
built businesses that have generated high returns for the investors.

Size of the Market

Demonstrating that the business will target an outsized, addressable

market opportunity is very important for grabbing VC investors'
attention. For VCs, "large" typically means a market which will generate
$1 billion or more in revenues. so as to receive the big returns that they
expect from investments, VCs generally want to make sure that their
portfolio companies have an opportunity of growing sales
worth many innumerable dollars.

The bigger the market size, the greater the likelihood of a trade sale,
making the business even more exciting for VCs searching for potential
ways to exit their investment. Ideally, the business will grow fast enough
for them to require first or second place within the market.

Great Product with Competitive Edge

Investors want to speculate in great products and services with a

competitive edge that's long lasting. they appear for an answer to a true,
burning problem that hasn't been solved before by other
companies within the marketplace. they give the impression of being for
products and services that customers can't do without – because it is
so far better or because it is so less expensive than the rest within
the market.

VCs hunt for a competitive advantage within the market. they need their

portfolio companies to be able to generate sales and profits before
competitors enter the market and reduce profitability. the less direct
competitors operating within the space, the better.

Assessment of Risks

A VC's job is to require on risk. So, naturally, they need to
grasp what they're stepping into once they take a stake in an early
stage company. As they speak to the business's founders or read
the business plan, VCs will want to be absolutely clear about what
the business has accomplished and what still has to be
accomplished.
  Could regulatory or legal issues pop up?
 Is this the proper product for today or 10 years from today?
 Is there enough money within the fund to totally meet the
opportunity?
 Is there an eventual exit from the investment and an
opportunity to work out a return?

The ways in which VCs measure, evaluate and take a look at to

attenuate risk can vary betting on the sort of fund and therefore
the individuals who are making the investment decisions. But at the
top of the day, VCs try to mitigate risk while producing big returns from
their investments.

RECOMMENDATION
Venture Capital Investments in Areas aside from Technology

One of the concerns for risk capital investment in India is that

VCs still invest in the areas they're most at home with i.e. predominantly
‘Information Technology’. Though other sectors like health care,
education and retailing have started drawing the
attention of the VCs in India; Information Technology (IT) receives the
best share in the pie. For increasing the competitiveness of the Indian
startups, there's a requirement to broaden the horizon of the areas
for capital investment by directing it to biotechnology,
telecommunications, agriculture, food processing, tourism and other
service sectors. Government policies for promoting the risk
capital funding in India, should, therefore, target how the funds are
literally invested especially within the areas
less targeted by the VCs thanks to lack of technology focus; rather just
on increasing available funding

Involvement of Sophisticated Investors like Pension Funds

The structuring of capital funds is such within the short run, these funds

incur losses but these are matched by the future capital gains.
So, it's very essential that the investors investing in risk capital funds
must be able likewise as prepared to attend for a extended period of your
time for significant returns and that they must even have the loss
bearing capacity, if it happens occasionally. In developed countries like
US, pension funds are the first investors in risk capital industry. These
investors can stay invested for an extended period of your time as they
need to satisfy the pension liabilities in far
distance future. In India, present pool of funds available for risk
capital is incredibly limited and is predominantly contributed by foreign
funds. If the risk capital funding is to grow, the govt. should relax
constraints on institutional investments in domestic venture funds.

Harmonization of Regulations for capital Industry

The regulatory, tax and legal environment should play a facilitating and
promotional role for the working capital industry to prosper in India.
Internationally, risk capital funds have evolved in an environment of
structural flexibility, fiscal neutrality and operational adaptability. At
present, the capital activity in India comes under the purview of
different sets of regulations. SEBI (Venture capital Funds) Regulation,
1996 lays down the overall regulatory framework for registration and
operations of capital funds in India. Overseas risk capital investments
are subject to the govt of India Guidelines for Overseas risk
capital Investment in India dated September 20, 1995.

Development of Relevant Secondary Capital Market/Stock

Exchange for Smaller Companies

Younger and smaller companies are leveraging on innovative

breakthroughs, carrying out the classic Schumpeterian ‘creative
destruction’ to form wealth. Options for raising capital for such small
companies are restricted when there's an absence of equity markets for
listing and trading of small-cap companies. It also implies that the
choices
before a seed investor especially VCs, in terms of finding a market and
for exit, remain obscure. Thus, establishment of secondary marketplace
for younger promising companies will also help in developing
the capital market, because it provides an alternate exit market through
Initial Public Offer (IPO) exits. Government can assist during
this directly
through the creation of second-tier stock markets for IPOs. securities
market that's specifically designed for smaller companies are a win- win
situation for the companies also because the investors.
 Provision of capital Funding to Small and Medium Enterprises
(SMEs)

To develop entrepreneurship, risk capital must concentrate its

investment in small and medium enterprises. The SMEs, account for
95% of the economic units and contribute 40% of the worth addition in
manufacturing and exports. Many entrepreneurs in this segment have
successful ideas but lack adequate capital more specifically
equity capital. Setting Up a Public Fund through Public Private
Partnership (PPP) for Funding Startups To encourage risk
capital investment within the startups, public funds with partnership of
the private sector is also formed at the national further as state level.
Such mechanisms are again found in US. In its Small Business no
depository financial institution (SBIC) scheme, private seed
and capital funds can borrow the funds from government at favorable
terms. These loans are then invested within the startups as equity. This
would
increase governments’ involvement in funding the ventures
indirectly. and therefore, the investors are also encouraged to enter into
risk financing.

SALES CHANNEL STRATEGY

Focus on the 4 P’s. They are:

Products, Promotions, Price, and Place.

Products. Detail all current and future products and services – but focus totally
on the short-to-intermediate time horizon.

Promotions. Explain exactly which marketing/advertising strategies are used

and why.

Price. take care to produce a transparent rationale for your pricing strategy.

Place. Explain exactly how your products/services are going to be delivered to
your customers.

Detail your customer retention plan:- Explain how you'll retain your

customers, whether through customer relationship management (CRM)
applications, building network externalities, introducing ongoing value-added
services, or other means.

Define your partnerships: - From an investor’s perspective, what

partnership you have got with whom isn't nearly as important because
the specific terms of the partnership. make certain to document the specifics of
the partnerships (e.g. how it'll work, the financial terms, the kinds of customer
leads expected from each partner, etc.).

Operations Plan

Goal of the operations plan: Present the action plan for executing on your
company’s vision.

Concept vs. reality. The operations plan transforms the business plan from
concept into reality. Investors don't invest in concepts; they invest really. and
therefore, the operations plan proves that the management team can execute on
your concept better than anybody else.

Everyday processes. Detail the short-term processes and systems that provide
your customers together with your products and services.

Business milestones. Lay out the many long-term business milestones for the

corporate, and prove that the team will execute on the long-term vision. a
good thanks to present the milestones is to arrange them into a chart with key
milestones on the left side and target dates on the proper side.
Be consistent. ensure that the milestone projections are in keeping with the
remainder of the business plan – particularly the finances.

Be aggressive but credible. Presenting an inspiration within which the

corporate grows too quickly will show the naiveté of the management team,
while presenting too conservative a growth plan will often fail to excite an early
stage investor (who typically looks for a 10X return on her investment).
Financial Plan

Goal of the financial plan: Explain how your business will generate returns for
your investors.

Detail all revenue streams. make certain to incorporate all revenue

streams. reckoning on the sort of business, these may include sales of
products/services, referral revenues, advertising sales, licensing/royalty fees,
and/or data sales.

Be per your pro-forma statements. Pro-forma statements are projected

financial statements. it's critical that these projections reflect the
opposite sections of your business plan.

Validate your assumptions and projections. The finances must detail your

key assumptions, and it's critical that these assumptions are feasible. make
certain to use competitive research to validate your projections and assumptions
versus the fact in your market place. Assessing and basing financial projections
on those of comparable firms will greatly validate the realism and maturity of
the financial projections.

Detail the uses of funds. Understandably, investors want to understand what,

specifically, you propose to try and do with their money. Uses of funds could
include expenses involved marketing, staffing, technology development, office
space, among other uses.

Provide a transparent exit strategy. All investors are motivated by a

transparent picture of your exit strategy, or the timing and method through
which they'll “cash in” on their investment. make sure to
supply comparable samples of firms who have successfully exited. the
foremost common exits are IPOs or acquisitions. And while the
precise method isn't always crucial, the investor wants to work out this
planning so as to raised understand the management team’s motivation and
commitment to assembling long-term value.
 CONCLUSION

Young and innovative high potential companies are central for the prosperous
economic development of regions. At the identical time, risk capital is
commonly one amongst the few financing options for these companies
and it's widely accepted that plungers play a key role in their development.
Hence, it's of utmost importance to secure an appropriate availability of working
capital for brand new ventures. However, it became clear throughout this thesis
that the availability of risk capital is very clustered in many
countries which Germany is not any exception during this regard. Furthermore, it
had been revealed that spatial proximity between venture capitalists and new
ventures represents a vital think about VC financing relationships. The clustering
of capital supply and also the importance of spatial proximity for the emergence
of VC financing relationships results in important implications for entrepreneurs,
venture capitalist, and policy makers.

This thesis restrained the role of spatial proximity between plungers and new

ventures throughout the VC investment process and is of high practical and
scientific relevance. Young and innovative high potential companies are central
for the prosperous economic development of regions. At the
identical time, capital is commonly one amongst the few financing options for
these companies and it's widely accepted that venture capitalists play a key role in
their development.994 Hence, it's of utmost importance to secure an appropriate
availability of venture capital for brand new ventures. However, it became clear
throughout this thesis that the supply of capital is extremely clustered in many
countries which Germany isn't any exception during this regard. Furthermore, it
had been revealed that spatial proximity between venture capitalists and new
ventures represents a very important consider VC financing relationships. The
clustering of working capital supply and therefore the importance of spatial
proximity for the emergence of VC financing relationships results in important
implications for entrepreneurs, venture capitalist, and policy makers.
Despite the high practical relevance of this subject, to the simplest knowledge of
the author no holistic theoretical framework regarding the impact of spatial
proximity on the likelihood to successfully pass the various phases of the VC
investment process existed before this thesis.