Venture Capital (VC)

Glossary

Banking

Venture Capital (VC)

Venture capital, known as VC, relates to capital investment in start-up or early-stage businesses. VC is provided by a wide range of specialist VC and other finance providers. These financial backers look for opportunities to get in early in the growth trajectory of high-growth companies and will follow established entrepreneurs with solid track records of delivering growth. As well as finance, VC providers also offer management, strategy, business and operational advice to company owners to accelerate and super-charge growth as a means of improving their financial returns over their hold period: the exit is typically in the five/seven to 10-year range. Venture capitalists do not look to acquire companies wholesale but to invest alongside founders and other finance providers. VC providers raise funds to acquire stakes in companies from third-party institutional investors (known as limited partners) and invest LP’s money alongside their own.

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