Venture Capitalist

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Wikis > Venture Capitalist

Definition

A venture capitalist, also known as VC, is a person or an investment firm that makes venture investments, and these venture capitalists are supposed to bring managerial and technical support as well as capital to the objects of their investments. Venture capitalists possess the core skill to identify novel technologies that have potential to generate high commercial values. Venture capitalists tend to work within venture capital firms and partnerships. Venture capital is typically sought by high-growth startups looking for the next round of funding. These businesses are usually a higher risk, but also have a higher pay off with success. Business seeking this type of funding are usually too small for a bank loan and have a relatively short operating history.

Types

VCs can be classified into different types according to different factors. Some venture capitalists tend to invest in new ideas while others prefer to invest in established companies that need to grow or go public. Some VCs invest solely in certain industries. Others prefer investing locally while others prefer investing nationwide. The expectations of venture capitalists also vary. Some want quick public sales for their invested companies, or expect fast growth. Others look for balance between growth and risk.