Question

What are the advantages and disadvantages of venture capital financing? What are the benefits of an IPO as a source of financing? Would you consider investing in Fago de Chao? Why or why not?

Answer 1

Venture capital is referring to private equity and the type of financing that investors provide start-up companies and small business operations that are believed to have long term growth potential.

Advantages of venture capital like no obligation for business expansion, repayment, easy to locate, venture capitalist are trustworthy and helpful in building networks and connections.

Disadvantages like dilution of ownership and control, possible to lead undervaluation, early redemption of venture capitalist, and venture capitalists take a long time to decide.

Initial public offer brings capital for the company for further operation and expansion of the organization, risk control, long term capital arranging without any debt and business can grow in all aspects.

Fago se Chao is a fine dining full-service Brazilian steakhouse and it is growing organization and investors can invest in this company share for a better return. As per the analyst and my understanding company will give a better return in long term prospects and we must consider investing in this company shares.