Publication detail

Private Equity and Venture Capital Financing in the Czech Republic and Other European Countries – Development,Opportunities and Limitations

RAJCHLOVÁ, J. BROŽ, Z. BARANYKOVÁ, M. POLÁK, M.

Original Title

Private Equity and Venture Capital Financing in the Czech Republic and Other European Countries – Development,Opportunities and Limitations

Type

journal article - other

Language

English

Original Abstract

Financing by means of private equity and venture capital (PE/VC) off ers businesses the resources required to fi nance their future growth and bring prospective business plans and innovative ideas to reality. This form of fi nancing is relatively new and even though it off ers clear advantages it is not frequently used in the Czech Republic and other European countries in the CEE region. This paper addresses current and very relevant issues related to this form of fi nancing. The purpose of this research is to identify opportunities and limitations for this type of fi nancing based on benchmarking analysis. This analysis observes the development of PE/VC fi nancing in the Czech Republic and compares it with several other countries in the CEE region. This paper discusses several factors that infl uence the development of PE/VC fi nancing. Several conclusions can be drawn from this research. The Czech Republic is in 10th place in the utilization of venture capital from the selected 22 countries covered in this research. The time frame for this research is between 2004 and 2010. A er thorough analysis of development and conditions in other countries a list of recommended changes that have proven positive impact on the whole economy is formulated. The relatively low level of utilization of the venture capital in the Czech Republic may be due to several things for example by a lack of knowledge of this form of fi nancing and the inability of the management to formulate a business plan that is interesting for the PE/VC investor. The managers are en afraid of the administrative complexity and also the investor expects relatively high profi tability of the investment. Another possible limitation is that the public issuing of stocks is used rarely in the Czech Republic. Another cause for the low level of utilization is the absence of public and institutional support for this form of financing. Venture capital has clear and measurable positive impacts on the whole economy and it is therefore important to support and research the use of this method of financing.

Keywords

venture capital, private equity, financing, firm, GDP, benchmarking

Authors

RAJCHLOVÁ, J.; BROŽ, Z.; BARANYKOVÁ, M.; POLÁK, M.

RIV year

2011

Released

30. 12. 2011

Publisher

MZLU

Location

Brno

ISBN

1211-8516

Periodical

Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis

Year of study

LIX

Number

7

State

Czech Republic

Pages from

307

Pages to

316

Pages count

9

BibTex

@article{BUT75114,
  author="Jaroslava {Rajchlová} and Zdeněk {Brož} and Michaela {Baranyková} and Michal {Polák}",
  title="Private Equity and Venture Capital Financing in the Czech Republic and Other European Countries – Development,Opportunities and Limitations",
  journal="Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis",
  year="2011",
  volume="LIX",
  number="7",
  pages="307--316",
  issn="1211-8516"
}