DBH Group, which is well-known for its unique business model in the market of business and investment services, provides physical infrastructure (serviced offices and serviced industrial facilities), related business services (finance, business administration, project management), and venture capital to Hungarian and international SME corporations. Over the past decades, DBH Group has invested in SME corporations of the high-growth, innovative, technology-intensive industry.
Private equity provides capital stock for companies not listed in the stock exchange. Private equity is used for developing new products, implementing new technologies, expanding working capital, acquisitions or improving the balance-sheet of a company. The process of private equity investment may as well rearrange the structure of ownership or management. In a family business, succession, or buy-in/buyout of experienced managers can also be solved by involving private equity.
Venture capital is, strictly speaking, only a subset of private equity, a professional investment for starting companies, for development or expansion at an early stage, which is financing by partnership with the owner.
Types of capital investment
Early stage investments
Seed capital: Funding prior to the start-up phase for studying, assessing and developing the initial business concept.
Start up: Funding for product development and initial marketing to companies that have not yet sold their product commercially and do not make profit.
Later stage financing
Expansion: funding for the growth or expansion of a company, with the aim to increase production capacity, perform market or product development, or provide additional working capital, regardless of whether the company is profitable or not.
Buy out: purchase of existing shares in a company from another venture capital or private owner.
Why is venture capital attractive?
• Gives a greater boost to the company
• Until the private investor exits, the invested capital serves the interests of the corporation
• Creates a solid and flexible base for realizing growth and development plans
• The investment does not need to be refunded, its value and return depends on the success of the company
• If the solvency or business prospects of the company are at stake, the private capital investor will do its best to reverse the situation and make the company profitable again
• A true business partner that shares the risks and shares the profits, while facilitating the success of the company by practical advices