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Venture capital (VC)

Venture Capital firms invest in startups at various stages, ranging from seed to Series A and beyond. Venture Capital firms take equity in exchange for capital, seeking to invest in firms. from the earliest stage Series A to later stages as the company grows. Venture firms typically lead only a single round and cede to other investors for the next round to avoid conflicts of interest in pricing the next round. Venture capital generally comes from a group of partners who set up a VCs firm and raise several capital funds from Limited Partners (LP), such as sovereign wealth funds or mutual pension funds. Venture capital is typically allocated to startups with exceptional growth potential or to or scale-up companies that have grown quickly and appear poised to continue to expand. Though it can be risky for investors who put up funds, the potential for above-average returns is an attractive payoff. For new companies or ventures with a limited operating history (under two years), venture capital funding is an essential source for raising capital, especially if they lack access to capital markets, bank loans, or other debt instruments. The main downside for the entrepreneurs is that the VC investors usually get 25-50%+ equity in the company, and, thus, a say in company decisions.

Venture Capital firms invest in startups at various stages, ranging from seed to Series A and beyond. Venture Capital firms take equity in exchange for capital, seeking to invest in firms. from the earliest stage Series A to later stages as the company grows. Venture firms typically lead only a single round and cede to other investors for the next round to avoid conflicts of interest in pricing the next round. Venture capital generally comes from a group of partners who set up a VCs firm and raise several capital funds from Limited Partners (LP), such as sovereign wealth funds or mutual pension funds. Venture capital is typically allocated to startups with exceptional growth potential or to or scale-up companies that have grown quickly and appear poised to continue to expand. Though it can be risky for investors who put up funds, the potential for above-average returns is an attractive payoff. For new companies or ventures with a limited operating history (under two years), venture capital funding is an essential source for raising capital, especially if they lack access to capital markets, bank loans, or other debt instruments. The main downside for the entrepreneurs is that the VC investors usually get 25-50%+ equity in the company, and, thus, a say in company decisions.