Venture capital (VC)

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    Venture capital (VC) is financial capital provided to start-up companies. It comes either from individual investors or specialised venture capital funds.

    The idea behind venture capital is to gain equity in the start-up companies. Often, the start-ups pursue new ideas, such as in the Internet or in biotechnology.

    Venture capital is a subset of private equity. Therefore, all venture capital is private equity, but not all private equity is venture capital.

    The typical venture capital investment occurs after the seed funding round as growth funding round (also referred to as Series A round). The idea is to generate a return through an eventual realization event, such as an IPO or trade sale of the company.