Venture Capital FirmEarly-stage venture capital firm shortly after its formation with initial investments. There is a single general partner with an extensive network of tech friends who can provide deal flow.The fund is looking for more limited partners.Question: would you invest in this early Venture capital firm based on the balanace sheet given? why or why not analyze carefully and explain in detail please.

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Venture Capital Firm Balance Sheet As of December 31 TOTAL ASSETS Current Assets Bank Accounts First Republic - Checking Total Bank Accounts 1,005,241.53 $ 1,005,241.53 $ 1,005,241.53 Total Current Assets Other Assets Investments Co #1 Co #2 Co #3 Co #4 Co #5 Total Xcalar 0.00 400,000.00 840,000.00 100,000.00 99,999.36 249,999.42 $ 249,999.42 Venture Capital Firm Profit and Loss January - December Total Investments Total Other Assets TOTAL ASSETS LIABILITIES AND EQUITY Total Liabilities Equity LP Contributions Receivable Partner's Capital General Partner GP- Contributions Total General Partner $ 1,689,998.78 $ 1,689,998.78 $ 2,695,240.31 $ 0.00 -225,000.00 0.00 0.00 92,876.50 $ 92,876.50 Total Limited Partners $ 3,003,000.00 Income Total Income Gross Profit Expenses Management Fee Operating Expenses Bank Charges Total Operating Expenses TOTAL $ 0.00 124,017.38 0.00 Professional Fees Legal Fees 31.00 0.00 25,707.42 Total Professional Fees $ 25,707.42 $ 25,738.42 Uncategorized Expense -0.12 Total Partner's Capital Retained Earnings Syndication Costs Net Income $ 3,095,876.50 -25,905.51 -149,730.68 Total Expenses $ 149,755.68 0.00 Net Operating Income -$ 149,755.68 Other Income Interest Income 25.00 Total Equity $ 2,695,240.31 Total Other Income $ 25.00 Net Other Income $ 25.00 TOTAL LIABILITIES AND EQUITY $ 2,695,240.31 Net Income -$ 149,730.68 Venture Capital Firm Balance Sheet As of December 31 TOTAL ASSETS Current Assets Bank Accounts First Republic - Checking Total Bank Accounts 1,005,241.53 $ 1,005,241.53 $ 1,005,241.53 Total Current Assets Other Assets Investments Co #1 Co #2 Co #3 Co #4 Co #5 Total Xcalar 0.00 400,000.00 840,000.00 100,000.00 99,999.36 249,999.42 $ 249,999.42 Venture Capital Firm Profit and Loss January - December Total Investments Total Other Assets TOTAL ASSETS LIABILITIES AND EQUITY Total Liabilities Equity LP Contributions Receivable Partner's Capital General Partner GP- Contributions Total General Partner $ 1,689,998.78 $ 1,689,998.78 $ 2,695,240.31 $ 0.00 -225,000.00 0.00 0.00 92,876.50 $ 92,876.50 Total Limited Partners $ 3,003,000.00 Income Total Income Gross Profit Expenses Management Fee Operating Expenses Bank Charges Total Operating Expenses TOTAL $ 0.00 124,017.38 0.00 Professional Fees Legal Fees 31.00 0.00 25,707.42 Total Professional Fees $ 25,707.42 $ 25,738.42 Uncategorized Expense -0.12 Total Partner's Capital Retained Earnings Syndication Costs Net Income $ 3,095,876.50 -25,905.51 -149,730.68 Total Expenses $ 149,755.68 0.00 Net Operating Income -$ 149,755.68 Other Income Interest Income 25.00 Total Equity $ 2,695,240.31 Total Other Income $ 25.00 Net Other Income $ 25.00 TOTAL LIABILITIES AND EQUITY $ 2,695,240.31 Net Income -$ 149,730.68

Answer rating: 100% (QA)

To evaluate whether to invest in the earlystage venture capital firm based on the balance sheet provided we need to consider several factors Current A... View the full answer