Title: Private Equity and Venture Capital in SMEs in Developing Countries: The Role for Technical Assistance
Abstract: No AccessPolicy Research Working Papers29 Apr 2014Private Equity and Venture Capital in SMEs in Developing Countries: The Role for Technical AssistanceAuthors/Editors: Shanthi Divakaran, Patrick J. McGinnis, Masood ShariffShanthi Divakaran, Patrick J. McGinnis, Masood Shariffhttps://doi.org/10.1596/1813-9450-6827SectionsAboutPDF (1.1 MB) ToolsAdd to favoritesDownload CitationsTrack Citations ShareFacebookTwitterLinked In Abstract: This paper discusses the constraints for private equity financing of small and medium enterprises in developing economies. In addition to capital, private equity investors bring knowledge and expertise to the companies in which they invest. Through active participation on the board of directors or in partnership with management, private equity investors equip companies with critical improvements in governance, financial accounting, access to markets, technology, and other drivers of business success. Although private equity investors could help to create, deepen, and expand growth of small and medium enterprises in developing economies, the vast majority of private equity in such markets targets larger or more established enterprises. Technical assistance, when partnered with private equity, can unlock more investor commitments and considerably enhance the ability of small and medium enterprises in emerging markets to raise private equity capital. Technical assistance provides funding that allows private equity funds to extend their reach to smaller companies. Technical assistance can mitigate some level of risk and increase the probability of successful investments by funding targeted operational improvements of investee companies. Dedicated technical assistance facilities financed by third parties, such as development finance institutions, governments, or other parties, have emerged to fill this critical need. The paper discusses the provision of investment capital twinned with technical assistance, which is now more accepted by limited partners and general partners or fund managers and is becoming more of a market model for private equity finance focused on small and medium enterprises. Previous bookNext book FiguresReferencesRecommendedDetailsCited ByMapping research in the field of private equity: a bibliometric analysisManagement Review Quarterly, Vol.262 August 2021The Influence of Government Support Interventions on the Growth of African Foreign-Owned SMMEs in South AfricaThe Financing of Small and Medium-Sized Enterprises: An Analysis of the Financing Gap in BrazilEuropean Business Organization Law Review, Vol.20, No.425 November 2019 View Published: April 2014 Copyright & Permissions Related TopicsFinance and Financial Sector DevelopmentMacroeconomics and Economic GrowthPrivate Sector Development KeywordsPRIVATE EQUITYVENTURE CAPITALSMALL AND MEDIUM ENTERPRISESTECHNICAL ASSISTANCE PDF DownloadLoading ...