The styles of nurturing refers to the extent of participation by VCIs in the affairs of VCUs. The style depends upon a variety of factors such as the specialization of the VCI, stage of investment, financing plan, the stage of the development of the venture capital industry itself and so on. It broadly falls into three categories: (i) hands-on, (ii) hands-off and (iii) hand-holding,

Hands-on Nurturing

It refers to continuous and constant involvement in the operations of the invested company which is institutionalized in the form of representation on the hoard of directors. With wider exposure and experience, VCIs can provide useful guidance on long term planning. technology development financial planning, marketing strategy and so on. The hands on care style is useful essential in early stage financing, i.e., seed capital and start-up investments. This type of care is provided either by the in house expertise or by a core group of external advisers experts in specific areas if the former is not available in all types of projects.

Hands-off Nurturing

VCIs play a relatively passive role in the hands off style. Although they usually reserve the right, they rarely have nominee directors on the board of the VCLs, Normally, do not actively participate in formulating strategies policy matters in spite of the right to do so. This type of nurturing style is appropriate in case of syndicated joint consortium venture financing in which some financiers may follow the hands on approach while others may follow hands of the approach. The hands off style may also be appropriate after the initial plan of there is over and the business is running smoothly.

Hands-holding Nurturing

This is mid way between hands on and hands off styles. It, is essentially, a reactive approach. Like the hands on style, the VCI has the right to have a nominee on the of directors of the VCU, but actively participates in the decision making process only on approached by the latter. If the VCU experiences any difficulty, the VCI provides either in house assistance or assistance from outside experts.

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