Venture capital

venture capitalistventure capitalistsventure capital firmventure capital fundventureventure-capitalVCventure fundbusiness ventureventure funding
Venture capital (VC) is a type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth (in terms of number of employees, annual revenue, or both).wikipedia
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Private equity

private-equityequityPrivate equity investor
Venture capital (VC) is a type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth (in terms of number of employees, annual revenue, or both).
A private equity investment will generally be made by a private equity firm, a venture capital firm or an angel investor.

Funding

financingfundsfund
Venture capital (VC) is a type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth (in terms of number of employees, annual revenue, or both).
Sources of funding include credit, venture capital, donations, grants, savings, subsidies, and taxes.

History of private equity and venture capital

1980s buyout boomHistory of venture capitalLBO boom
(History of venture capital)
The history of private equity and venture capital and the development of these asset classes has occurred through a series of boom and bust cycles since the middle of the 20th century.

Georges Doriot

G. F. DoriotGeorges F. Doriot
Georges Doriot, the "father of venture capitalism" (and former assistant dean of Harvard Business School), founded the graduate business school INSEAD in 1957.
Georges Frédéric Doriot (September 24, 1899 – June 1987) was a French-born American venture capitalist.

J.H. Whitney & Company

Only after 1945 did "true" private equity investments begin to emerge, notably with the founding of the first two venture capital firms in 1946: American Research and Development Corporation (ARDC) and J.H. Whitney & Company. John Hay Whitney (1904–1982) and his partner Benno Schmidt (1913–1999) founded J.H. Whitney & Company in 1946. Even industry founders J.H. Whitney & Company and Warburg Pincus began to transition toward leveraged buyouts and growth capital investments.
J.H. Whitney & Company is a venture capital firm in the U.S., founded in 1946 by John Hay Whitney and his partner Benno Schmidt.

Startup company

startupstartupsstartup companies
Venture capital (VC) is a type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth (in terms of number of employees, annual revenue, or both).
Anyone can be a co-founder, and an existing company can also be a co-founder, but the most common co-founders are founder-CEOs, engineers, hackers, web developers, web designers and others involved in the ground level of a new, often venture.

American Research and Development Corporation

American Research & Development
Only after 1945 did "true" private equity investments begin to emerge, notably with the founding of the first two venture capital firms in 1946: American Research and Development Corporation (ARDC) and J.H. Whitney & Company.
American Research and Development Corporation (ARDC) was a venture capital and private equity firm founded in 1946 by Georges Doriot, the former dean of Harvard Business School and "father of venture capitalism", with Ralph Flanders and Karl Compton (former president of MIT).

Benno C. Schmidt Sr.

Benno SchmidtBenno C. Schmidt
John Hay Whitney (1904–1982) and his partner Benno Schmidt (1913–1999) founded J.H. Whitney & Company in 1946.
Benno Charles Schmidt Sr. (January 10, 1913 – October 21, 1999) was an American lawyer and venture capitalist who was active in New York City civic affairs and played an important role in the initiation of the War on Cancer.

Greylock Partners

GreylockGreylock Ventures
Former employees of ARDC went on to establish several prominent venture-capital firms including Greylock Partners (founded in 1965 by Charlie Waite and Bill Elfers) and Morgan, Holland Ventures, the predecessor of Flagship Ventures (founded in 1982 by James Morgan).
Greylock Partners is one of the oldest venture capital firms, founded in 1965, with committed capital of over $3.5 billion under management.

Laurance Rockefeller

LauranceLaurance S. RockefellerLaurance Spelman Rockefeller
In 1938, Laurance S. Rockefeller helped finance the creation of both Eastern Air Lines and Douglas Aircraft, and the Rockefeller family had vast holdings in a variety of companies.
He was a leading figure in the pioneering field of venture capital, which began as a joint partnership with all five brothers and their only sister, Babs, in 1946.

Venrock

Rockefeller BrothersVenrock Associates
It is commonly noted that the first venture-backed startup is Fairchild Semiconductor (which produced the first commercially practical integrated circuit), funded in 1959 by what would later become Venrock Associates.
Venrock, a compound of "Venture" and "Rockefeller", is a venture capital firm formed in 1969 to build upon the successful investing activities of the Rockefeller family that began in the late 1930s.

Series A round

Series ASeries A fundingSeries A financing
The first round of institutional venture capital to fund growth is called the Series A round.
Because there are no public exchanges listing their securities, private companies meet venture capital firms and other private equity investors in several ways, including warm referrals from the investors' trusted sources and other business contacts; investor conferences and demo days where companies pitch directly to investor groups.

Kleiner Perkins

KPCBKleiner Perkins Caufield & ByersKleiner
The growth of the venture capital industry was fueled by the emergence of the independent investment firms on Sand Hill Road, beginning with Kleiner Perkins and Sequoia Capital in 1972.
Kleiner Perkins, formerly Kleiner Perkins Caufield & Byers (KPCB), is an American venture capital firm headquartered on Sand Hill Road in Menlo Park in Silicon Valley.

Sequoia Capital

SequoiaSequoia Capital ChinaSequoia China
The growth of the venture capital industry was fueled by the emergence of the independent investment firms on Sand Hill Road, beginning with Kleiner Perkins and Sequoia Capital in 1972.
Sequoia Capital is an American venture capital firm.

Clean technology

clean technologiesclean-techcleantech
The start-ups are usually based on an innovative technology or business model and they are usually from the high technology industries, such as information technology (IT), clean technology or biotechnology.
Cleantech is often associated with venture capital funds and land use organizations.

Private equity firm

private equity firmsprivate equity groupprivate equity
Private equity firms organized limited partnerships to hold investments in which the investment professionals served as general partner and the investors, who were passive limited partners, put up the capital.
A private equity firm is an investment management company that provides financial backing and makes investments in the private equity of startup or operating companies through a variety of loosely affiliated investment strategies including leveraged buyout, venture capital, and growth capital.

Sand Hill Road

A street in Menlo Park, California
The growth of the venture capital industry was fueled by the emergence of the independent investment firms on Sand Hill Road, beginning with Kleiner Perkins and Sequoia Capital in 1972. The late 1990s were a boom time for venture capital, as firms on Sand Hill Road in Menlo Park and Silicon Valley benefited from a huge surge of interest in the nascent Internet and other computer technologies.
Sand Hill Road, often shortened to just "Sand Hill", is an arterial road in western Silicon Valley, California, running through Palo Alto, Menlo Park, and Woodside, notable for its concentration of venture capital companies.

William Henry Draper III

Bill DraperWilliam DraperWilliam H. Draper III
An early West Coast venture capital company was Draper and Johnson Investment Company, formed in 1962 by William Henry Draper III and Franklin P. Johnson, Jr. In 1965, Sutter Hill Ventures acquired the portfolio of Draper and Johnson as a founding action.
In 1959, Draper left Chicago to work as an associate at his father's newly formed firm, Draper, Gaither & Anderson, the first venture capital company on the West Coast.

Massachusetts Institute of Technology

MITMassachusetts Institute of Technology (MIT)M.I.T.
Along with Ralph Flanders and Karl Compton (former president of MIT), Doriot founded ARDC in 1946 to encourage private-sector investment in businesses run by soldiers returning from World War II.
In 1946, President Compton, Harvard Business School professor Georges Doriot, and Massachusetts Investor Trust chairman Merrill Grisswold founded American Research and Development Corporation, the first American venture-capital firm.

Silicon Valley

Silicon Valley, CaliforniaSan JoseValley
The late 1990s were a boom time for venture capital, as firms on Sand Hill Road in Menlo Park and Silicon Valley benefited from a huge surge of interest in the nascent Internet and other computer technologies.
Silicon Valley also accounts for one-third of all of the venture capital investment in the United States, which has helped it to become a leading hub and startup ecosystem for high-tech innovation and scientific development.

Chemical Bank

Chemical Bank & Trust Co.Chemical Corn Exchange BankChemical
Additionally, venture capital units within Chemical Bank and Continental Illinois National Bank, among others, began shifting their focus from funding early stage companies toward investments in more mature companies.
Global Bank The Global Bank served the bank's large corporate clients and was made up of a traditional investment banking division, known as Global Banking & Investment Banking as well as a sales and trading division, known as Global Markets. Global Banking & Investment Banking performed advisory services such as mergers and acquisitions and restructuring as well as capital raising functions, such as leveraged loan syndication, high yield financing and other debt and equity underwriting. The bank's private equity and venture capital functions were also housed in this division. Global Markets was primarily focused on sales and trading activities, foreign exchange dealing; derivatives trading and structuring, risk management and other market related functions. In 1995, Chemicals Global Bank revenue was roughly balanced between investment banking and markets activities

Growth capital

growth equitygrowth capital firmeconomical growth
Even industry founders J.H. Whitney & Company and Warburg Pincus began to transition toward leveraged buyouts and growth capital investments.
These companies are likely to be more mature than venture capital funded companies, able to generate revenue and profit but unable to generate sufficient cash to fund major expansions, acquisitions or other investments.

Dot-com bubble

dot-com boomdot-com bustdot-com crash
Yale School of Management Professor Andrew Metrick refers to these first 15 years of the modern venture capital industry beginning in 1980 as the "pre-boom period" in anticipation of the boom that would begin in 1995 and last through the bursting of the Internet bubble in 2000.
Venture capital was easy to raise.

Venture debt

Between the first round and the fourth round, venture-backed companies may also seek to take venture debt.
Venture debt can complement venture capital and provide value to fast growing companies and their investors.

Venture round

Series BSeries Cseries B round
There are typically six stages of venture round financing offered in Venture Capital, that roughly correspond to these stages of a company's development.
A venture round is a type of funding round used for venture capital financing, by which startup companies obtain investment, generally from venture capitalists and other institutional investors.