Attempts means In exchange for this financing VCs receive a

Attempts means. In exchange for this financing, VCs receive a share of a company\'s equity, and the founders of the firm typically stay on and continue to manage the company

Solution

Venture capitalist firms generally invest in small fast-growing firms with an objective of cashing out when firm attain a certain value and is ready for listing at stock market or are acquired by some other large organization.

So,

A VC firm wants management to focus on improving firm value, while the managers may also act to increase personal well-being.

VCs generally demand board seats in order to have say in operations of company funded by them.

So,

Placing VCs on the company\'s board serves to decentralize decision-making authority.