Venture Capital Risk Issues

The rapid growth of e-commerce technology has spurred a tremendous escalation of merger and acquisition activity by both private equity and venture capital firms. The current success of firms like Internet Capital Group has encouraged similar investment strategies by a host of other like-minded entrepreneurs.

All of this activity will ultimately improve business and increase profits, but it is also a door through which uncertainty and risk of loss will enter.

Many of these risks can be identified by a thorough due diligence procedure. However, there may continue to exist a concern in risk perception between a buyer and a seller and the initial investors in your fund.

J. M. Patton Associates, Inc. (JMP) can assist in reducing that uncertainty by providing the following risk transfer products and design:

•
 Representations and Warranties Insurance including Tax Opinion/Representation Liability
•
 Environmental Impairment Liability and Cleanup Cover
•
 Loss Mitigation Cover
•
 Loss Buyout and Portfolio Transfer
•
 Venture Capital/Private Equity Management Liability including:
General Partner Liability
Directors and Officers Liability
Employment Practices Liability
Investment Advisors Liability 
Outside Directorship Liability
Controlling Shareholder Liability
Organizational Liability including:
Private Organization Coverage – all claims
Public Organizational Coverage – Securities Claims; Employment Practices Liability Claims

For further information, please contact Jack Patton at jackp@jmpatton.com