Ryland Campbell(left), chairman of Capital and Credit Financial group, chats with Richard Byles(centre), president of Life of Jamaica and Hayden Singh of Courts.

A suggestion earlier this week by Capital & Credit Financial Group chairman, Ryland Campbell, that there is a need for a venture capital fund to be established in Jamaica, has received strong support from a wide cross section of business leaders.

Speaking at a luncheon hosted by Observer chairman, Gordon 'Butch' Stewart, at the newspaper's Beechwood Avenue headquarters on Tuesday, Campbell stated that he was bemused as to why there is so much red tape regarding venture capital initiatives and urged bureaucrats to be more supportive of persons willing to take risks.

"I think there is the need for the facilitation for persons who want to invest and take risks," said Campbell. "For example, why are there so many rules about venture capital that you can't start anything?" he asked.

"If you want to invest x million dollars through a number of ventures which stimulates entrepreneurship, you should be allowed to do it," he continued. "Give me the criteria, let me take the risk."

A Venture capital is a type of private equity capital provided by a pooled investment vehicle known as a venture capital fund, to new growth businesses. This type of investment, which is basically financing in exchange for shares in the venture company, is normally high-risk, but at the same time provides an opportunity for very high returns.

Stewart, in support of Campbell's suggestion, noted that local business persons starting out are at a fundamental disadvantage in terms of access to capital and financing, making it very difficult for them to survive in Jamaica's stifling business environment. Such an initiative, he said, would help businesses get off the ground.

"Before you start a business today you need a lot to finance your business just between the wharf and when you get it to your warehouse," said Stewart. "It's a heart attack; youngsters with limited capital that are ambitious enough to try something for themselves are going to fail before they start. If you want to fix a country, you have to go to those places and fix them."

Former president of the Jamaica Chamber of Commerce, Anthony Chang, said that the initiative will encourage much-needed entrepreneurism in Jamaica.

"Anything that can stir entrepreneurial activity can't be wrong," said Chang. "The two problems that we have in Jamaica are access to capital and a lot of times, the red tape. If we can really develop a true venture capital process and system in Jamaica, it can only help us."

Prominent financial analyst, Dennis Chung, told Caribbean Business Report that the establishment of a venture capital fund is an "excellent idea", and encouraged business persons to take the initiative by actively pooling some of their wealth to start a fund.

"I agree that a major venture capital fund is needed," said Chung. "What needs to happen now is that the private people who want that to happen have to be willing to bring that money at an appropriate competitive cost of capital, understanding the risk that they are taking. It is one thing to say that they want a venture capital, but it is another one for them to now put their money where their mouth is."

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