venture capital

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Venture capital

An investment in a start-up business that is perceived to have excellent growth prospects but does not have access to capital markets. Type of financing sought by early-stage companies seeking to grow rapidly.

Venture Capital

The provision of funding for a start-up. For example, suppose a company with little access to capital is attempting to open a new market or access an old one with a better product. It may not be able to receive loans, either because of an unproven track record or because it is already significantly in debt, and it may have exhausted financing from family and friends. Venture capital allows this company to begin and build upon its operations by providing necessary funding. Usually, the provider of venture capital takes equity in the company in exchange for the money. Venture capital firms may also provide needed expertise in how to run a business than can help the start-up become successful.

venture capital

A pool of risk capital, typically contributed by large investors, from which allocations are made available to young, small companies that have good growth prospects but are short of funds. Small investors can buy new issues or participate in mutual funds that specialize in the supply of venture capital. Also called risk capital.

Venture capital (VC).

Venture capital is financing provided by wealthy independent investors, banks, and partnerships to help new businesses get started, reach the next level of growth, or go public.

In return for the money they put up, also called risk capital, the investors may play a role in the company's management as well as receive some combination of equity, profits, or royalties.

Some venture capital also goes into bankrupt companies to help them turn around, or to companies that the management wants to take private by buying up all the outstanding shares.

venture capital

money subscribed in the form of SHARE CAPITAL and LOAN CAPITAL to finance new firms and activities which are considered to be of an especially risky nature and hence unable to attract finance from more conventional sources. There are a number of specialist institutions covering this sector of the capital market (see STOCK MARKET), including THREE I'S (formerly Investors in Industry) and the venture capital arms of the COMMERCIAL BANKS, INVESTMENT BANKS and MERCHANT BANKS.

Venture capital investors originally concentrated most of their funding on small start-up businesses offering innovative products, but recently a substantial proportion of their funds has been directed towards the less risky business of financing MANAGEMENT BUY-OUTS of established companies.

The British Venture Capital Association represents firms and institutions operating in this area.

venture capital

any SHARE CAPITAL or LOANS subscribed to a firm by financial specialists (for example, the venture-capital arms of the commercial banks), thus enabling the firm to undertake investment in processes and products that, because of their novelty, are rated as especially high-risk projects and, as such, would not normally attract conventional finance. In addition, in recent years venture capitalists have become increasingly involved in financing MANAGEMENT BUY-INS and MANAGEMENT BUYOUTS. See JUNK BOND, THREE I‘S.

venture capital

A common name given to money raised for investment in high-risk enterprises. Venture capital firms may specialize by industry and/or by stage—seed money for start-ups, midstage firms on the brink of success but needing additional capital, or successful firms capable of expansion to a regional or nationwide platform. There is a National Venture Capital Association ( Sometimes called angel investors.

References in periodicals archive ?
Venture-backed biotechs that are going public are doing so with substantial participation from their venture investors as well as other insiders.
That reality is made even starker by the fact that the valuations of these IPOs are often coming at a modest increase in valuation relative to the last round of venture funding, offering little opportunity for venture investors to capture big returns without substantial moves in the aftermarket for these stocks.
Mergers and acquisitions have become the preferred exits for venture investors, not only because of the expediency these transactions provide, but because the valuations are generally far more favorable.
Venture investors look for high-growth opportunities and for entrepreneurs with a "big vision," he said.
Venture Investors is a venture capital firm with $200 million under management.
Over the last two decades, the driving force behind Venture Investors' success has been our track record of backing early stage spin-outs from the nation's fourth largest research institution, the University of Wisconsin-Madison," said John Neis, co-founder and managing director of Venture Investors.
Both EDF Ventures and Venture Investors will add value to the emerging technologies sector that Governor Granholm has outlined as part of her plan to get Michigan's economy back on track.
Additional investors providing funding include new investors Alloy Ventures, Bridgescale Partners, Doll Capital Management, and Sofinnova Ventures, and along with all of Cortina's existing venture investors.
The financing closed August 31, 2006, and included all of the existing venture investors, a new institutional investor, and individual private investors connected to Phoseon's target markets.
As a highly respected and experienced group of life science venture investors, their decision to invest is further validation of Lux's business strategy, products and experienced management.
Cornice customers consist of the world's leading consumer electronics manufacturers and its venture investors include BA Venture Partners, BlueRun Ventures, the Caisse de depot et placement du Quebec, and VantagePoint Venture Partners.