The PE/VC Playbook for MSMEs (8/4/2022)
The PE/VC Playbook for MSMEs
A sector employing 12 crore people, responsible for half of the exports – yet fails to attract private capital into business leading to constant starvation of funds.
While giving a professional structure to business, a PE funds or VCs participate in the growth actively. Valuable expertise, debt for the long run and quality capital are some of the benefits.
Being the most expensive form of capital due to reasons such as having no predetermined rate of interest, should be only used in areas where the return on investments is higher than the cost of capital, which will help fetch higher returns.
PE players get involved with the strategy and management, which can help MSMEs to scale up fast, if an enterprise is willing to adapt, then the private capital investment is certainly good news.
