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Venture Capital.
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- Author(s): Caffrey, Cait
- Source:
Salem Press Encyclopedia, 2023. 2p.
- Subject Terms:
- Additional Information
- Abstract:
Venture capital is a type of financial support given to startup businesses that cannot obtain capital, or money, through traditional financing, such as banks. Venture capital is a private investment rather than a loan; venture capital firms invest funds into a company in exchange for equity, or ownership. Venture capital commonly funds young companies with a high potential for growth. Most venture capital firms invest in innovative businesses, usually in the biotechnology and information technology industry. This type of financing seeks a large return on investment. The growth potential of a company cannot be guaranteed, however, making venture capital a high-risk investment.
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