Are the investment funds all the same?
Of course not. The funds are distinguished by legal and organizational form, by collection strategy as well as by investment.
We have seen venture capital and private equity companies at the beginning of our journey, as funds that focus either on the initial stages of the birth of a company (startup) or on its development.
A third category of investors consists of business angels, ie entrepreneurs, sometimes former business owners or former managers, who have capital, knowledge and skills to employ in the company.
These investors are generally interested in investing in startups, to which they provide not only economic capital but also skills and time. For this reason they prefer, always in principle, companies based near the area where they reside.
A significant distinction between investment funds is linked to the collection strategy. In this case we talk about closed-end funds and open-ended funds.
The fund is defined as closed because it is not granted to the subscribers of the units to redeem these at any time, but only at maturity. The collection takes place through institutional and private investors. Capital is invested in unlisted companies with high development potential. In this way the Fund manager has available capital for a medium-long term period.
On the other hand, the so-called Open Funds can be subscribed at any time and it is always possible to obtain the full or partial repayment of the capital contributed. Precisely for this reason a part of the capital is always kept liquid, and the investment capacity is limited.
In the next article we will see the steps to present a project to an investment fund