Venture-capital firms look at the business plans more closely and they put more efforts in due diligence. He founded his company in January 2000 with money borrowed from family, friends and private investors. Cityfolio is in need of capital again to expand its operations and Ying says he expects this round of fund-raising to be tough. This time around, only the truly successful companies will be able to raise money because venture capitalists are asking tougher questions. Venture capital firms complain that there are too many copycat B2B portals and exchanges in Asia.
Most venture capitalists invest only in companies with a global market reach.
We like to invest in global companies or those that have the potential to become one. We invest in people. Every venture capital firm looks for a start-up that eventually will make an initial public offer because that's where the big money is. But as less than half of all Internet start-ups end up listed, an exit strategy through sales or mergers is vital. No venture-capital firm will invest in a company that doesn't have an exit strategy.