Venture Capital

Compared to angels, venture capitalists can invest larger amounts of money (usually millions of dollars) in a company and in exchange they tend to receive more equity. VC’s also exercise control and bring experienced management talent to help guide and grow the company. Sometimes they invest in several rounds of funding and are part of a larger consortium of investors in the company. According to PriceWaterhouseCoopers (www.pwcmoneytree.com), the U.S. total of VC investments in 2015 was $58.811 billion from 4,380 deals.

This graphic is an example of a startup financing cycle using traditional funding sources, through an initial public offering (IPO). There could be more or fewer rounds of funding. The 1st, 2nd, and 3rd rounds can be equivalent to Series A, B, and C. (Source: “Startup Company” Wikipedia, The Free Encyclopedia. Wikimedia Foundation, Inc. 11 March 2009. Web. June 2012 http://en.wikipedia.org/wiki/File:Startup_financing_cycle.svg)

Startup Guide Section: