Venture Capital (VC)

Venture capital refers to equity capital invested in young companies — often not yet profitable — with high growth potential. VC investors typically take minority stakes and aim to actively support the management.

Venture capital investors accept a higher risk of default on individual investments in exchange for above-average return opportunities at the portfolio level. Liquidation preference, anti-dilution and vesting are regularly standard building blocks of the investment agreements. Advice on successfully raising VC financing can be found, for example, here.