Using of Venture and Equity Capital in Financing of SMEs in the Slovak Republic
Using of Venture and Equity Capital in Financing of SMEs in the Slovak Republic

Author(s): Katarína Rentková
Subject(s): National Economy, Business Economy / Management, Micro-Economics, Financial Markets
Published by: Masarykova univerzita nakladatelství
Keywords: equity capital; investment; venture capital; Slovak Republic; SMEs;
Summary/Abstract: The economy of the Slovak republic is integrated within the frame of the global world economy. The companies are functioning in the highly competitive environment. SMEs dominate the Slovak economy, covering 99.5% of the enterprise population. The vast majority of SMEs were micro enterprises, employing up to 9 employees. Self-entrepreneurs are an important component of the enterprise population in the Slovak Republic. Available financial resources are a key factor for the development of SMEs, also in the Slovak Republic. SMEs may be funded from various sources. Venture capital funds are oriented towards financing establishment and growth of small innovative businesses. In this paper, we will define SMEs, the venture and equity capital and we will analyze the role of venture and equity capital in financing of SMEs in the Slovak Republic. The use of private equity capital and venture capital in Slovakia reached the peak in 2009. Since then, the only decline is noticeable or the stability of the compared period. The most important problem can be the lack of knowledge of entrepreneurs about the possibilities of funding for their projects by venture capital. It is clear that Slovakia has a high innovation potential and significant development begins in the area of start-ups.

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