Risk Capital Leaves America

Share Article

This Venture Capital Club grows as the Venture Capital Club industry dies. Leverage, liquidity and a focus on funding startup multinational corporations are its secrets to speculative investment success for its members.

Founded in 2003, as traditional venture capital clubs were disappearing in the aftermath of the DotCom implosion, The Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/ has attracted international interest and support from its inception. Today, there are over 12,000 business and investment websites that have linked to it.

The Global Village Investment Club's (GVIC) strategy evolved from an e-book Venture Capital Profits (VCP), written in 2002 by Mr. William Cate, GVIC's Executive Director. In Venture Capital Profits, Mr. Cate suggested that CISCO SYSTEMS' use of their publicly traded shares to leverage the company's buying of cash-producing assets was the

only logical use of public company stock. The role of venture capital should be to supply the cash component of these early stock leveraged acquisitions. After the multinational corporation's first few cash-producing acquisitions, the corporate profits from these initial leveraged acquisitions supply the multinational corporation with the cash component for future leveraged growth. The leveraged growth formula should be, as CISCO has successfully proven, 75% stock and 25% cash.

In VCP, Mr. Cate argues that there is a basic difference in most national government relationships between national and multinational companies. A national company is an involuntary economic supporter of

the national government under which it operates. A multinational corporation is a beneficiary of the national government's need to create jobs and favorable trade balances. Most governments are willing to give regulatory exceptions, tax breaks and low interest loans and government grant incentives to multinationals. Doing so is

the only way that the multinational corporation will create local jobs that create export goods and result in the infusion of foreign

currency in the national economy. Risk capital investors are wiser to bet on multinationals getting government financial benefits than

national companies getting nearly nothing in government enticements.

VCP holds that shareholders must be investors and not speculators.Investor Relations costs are too high to allow a start-up multinational corporation to undertake leveraged asset growth and also pay the costs of repeatedly finding buyers for their company's publicly held shares. However, if the multinational corporation deviates from its stated strategic growth plan, investors have the liquidity insurance of owning public stock and they can sell their shares and recover their risk capital.

The Global Village Investment Club is an organization of accredited investors seeking international investment opportunities that reflect the Venture Capital Profits Strategy. For more information visit:

[http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/

###

Share article on social media or email:

View article via:

Pdf Print

Contact Author

William Cate
Visit website