Venture capital

Venture capital is equity financing for young or growing companies with high growth potential, typically provided in exchange for an ownership stake.

Venture capital fund: An investment vehicle that pools capital to invest in startup and growth-stage companies. It channels investors’ money into the companies venture capitalists select.
Seed funding: Early financing used to develop a business idea, product, or initial operations. It is often the first institutional or outside equity investment in a startup.
Angel investor: An individual who invests personal money in early-stage companies, often before institutional funding. Angels often invest earlier and with smaller checks than venture capital funds.
Founder dilution: The reduction in a founder's ownership percentage when a company issues additional shares. Each funding round can shrink founders’ share of the company.
Venture capital performance: The investment returns generated by venture funds relative to their costs and benchmarks. Returns are difficult to compare because fund results vary widely and mature slowly.
Limited partnership: A business structure with general partners who manage the enterprise and limited partners whose liability is restricted. Venture funds commonly use this structure to separate managers from capital providers.
Series A round: A startup's first major venture financing round after initial seed funding. It commonly funds a company seeking to validate and scale its business model.
Private equity: Investment in companies through privately negotiated equity ownership, often involving mature businesses. It is a broader category that includes venture capital and buyouts of established companies.
Board of directors: A governing body that oversees an organization and, in a corporation, represents shareholders. Venture investors may gain board seats and influence over company decisions.
J-curve (private equity): A pattern in which private investment funds often show early losses before later gains appear. It complicates judgments about venture fund performance during their early years.

Linked from 23 pages