The objective of capital investment decisions includes allocating the company's capital investment funds in the most efficient manner possible to ensure that returns are the best possible. Researchers indicated that there are basically four methods used in practice, namely payback period (PP), internal rate of return (IRR), accounting rate of return (ARR) and net present value (NPV). ) used by companies to evaluate investment. opportunities across the world (Atrill & Mclaney, 2008). The net present value (NPV) and internal rate of return (IRR) methods are considered discounted cash flow (DCF) methods. The payback period (PB) and average accounting rate of return (ARR) methods are so-called non-DCF methods (Hermes, Smid and Yao, 2006). The time required to achieve the return on investment is called the payback period (PP). . Under the payback method, the required payback period sets the minimum rate (threshold) for project acceptance. (Lefley 1996) The retrieval method is typically used to compare two or more projects and is widely accepted as a general rule. In a survey conducted in India, Cherukuri (1996) analyzed that return on investment was widely used as an “additional decision criterion”. The internal rate of return (IRR) is the discount rate often used in capital budgeting that renders the net present value of all cash flows. of a certain project equal to zero. This essentially means that IRR is the rate of return that sums the present value of future cash flows and the final market value of a project (or investment) equals its current market value (Stefan Yard 1999 ). The higher the internal rate of return of a project, the more desirable it is to undertake the project. A company's performance is often evaluated by ...... middle of paper ...... initially so that the young company's scarce sales and marketing resources can be properly targeted. Factor analysis of the results indicates that venture capitalists appear to systematically evaluate companies based on six categories of risks to manage. These are: the risk of losing the entire investment; the risk of not being able to escape if necessary; risk of failure to implement the business idea: competitive risk; risk of management failure; and the risk of leadership failure (Macmillan, Siegel, & Narasimha, 1985). MacMillan et al. (1987) identified five similar types of risks: management risk, competitive exposure, inexperience risk, viability risk, and cash out risk. Cresswell (2004) listed four risk factors that can impact the investment decision process: political and policy factors, organizational factors, business process factors, and technological factors.