Definition
Venture capital is a form of private equity funding early-stage companies with high growth potential. VC firms provide capital in exchange for equity, often taking board seats to guide strategy. Most VC investments fail, but successful ones can return 10-100x. Common exit routes are IPO or acquisition.
Example
A VC firm invests $5M in a Series A round for 20% of a tech startup, hoping the company reaches a $500M+ valuation.
FAQ
What is Venture Capital?
Financing provided to early-stage, high-potential startups.
Why is Venture Capital important?
Venture Capital helps investors evaluate alternative investments and make more informed decisions.