Venture capital (VC) is a type of private equity,[1] 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). Venture capital firms or funds invest in these
early-stage companies in exchange for equity,
or an ownership stake, in the companies they invest in. Venture
capitalists take on the risk of financing risky start-ups in the hopes
that some of the firms they support will become successful. 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.
The typical venture capital investment occurs after an initial "seed funding" round. The first round of institutional venture capital to fund growth is called the Series A round. Venture capitalists provide this financing in the interest of generating a return through an eventual "exit" event, such as the company selling shares to the public for the first time in an initial public offering (IPO) or doing a merger and acquisition (also known as a "trade sale") of the company.
In addition to angel investing, equity crowdfunding and other seed funding options, venture capital is attractive for new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering. In exchange for the high risk that venture capitalists assume by investing in smaller and early-stage companies, venture capitalists usually get significant control over company decisions, in addition to a significant portion of the companies' ownership (and consequently value). Start-ups like Uber, Airbnb, Flipkart, Xiaomi & Didi Chuxing are highly valued startups, where venture capitalists contribute more than financing to these early-stage firms; they also often provide strategic advice to the firm's executives on its business model and marketing strategies.
Venture capital is also a way in which the private and public sectors can construct an institution that systematically creates business networks for the new firms and industries, so that they can progress and develop. This institution helps identify promising new firms and provide them with finance, technical[2] expertise, mentoring, marketing "know-how", and business models. Once integrated into the business network, these firms are more likely to succeed, as they become "nodes" in the search networks for designing and building products in their domain.[3] However, venture capitalists' decisions are often biased, exhibiting for instance overconfidence and illusion of control, much like entrepreneurial decisions in general.[4]
The typical venture capital investment occurs after an initial "seed funding" round. The first round of institutional venture capital to fund growth is called the Series A round. Venture capitalists provide this financing in the interest of generating a return through an eventual "exit" event, such as the company selling shares to the public for the first time in an initial public offering (IPO) or doing a merger and acquisition (also known as a "trade sale") of the company.
In addition to angel investing, equity crowdfunding and other seed funding options, venture capital is attractive for new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering. In exchange for the high risk that venture capitalists assume by investing in smaller and early-stage companies, venture capitalists usually get significant control over company decisions, in addition to a significant portion of the companies' ownership (and consequently value). Start-ups like Uber, Airbnb, Flipkart, Xiaomi & Didi Chuxing are highly valued startups, where venture capitalists contribute more than financing to these early-stage firms; they also often provide strategic advice to the firm's executives on its business model and marketing strategies.
Venture capital is also a way in which the private and public sectors can construct an institution that systematically creates business networks for the new firms and industries, so that they can progress and develop. This institution helps identify promising new firms and provide them with finance, technical[2] expertise, mentoring, marketing "know-how", and business models. Once integrated into the business network, these firms are more likely to succeed, as they become "nodes" in the search networks for designing and building products in their domain.[3] However, venture capitalists' decisions are often biased, exhibiting for instance overconfidence and illusion of control, much like entrepreneurial decisions in general.[4]
Rank | Portrait | Name | Firm |
---|---|---|---|
1 | Bill Gurley | Benchmark | |
2 | Chris Sacca | Lowercase Capital | |
3 | Jeffrey Jordan | Andreessen Horowitz | |
4 | Alfred Lin | Sequoia Capital | |
5 | Brian Singerman | Founders Fund | |
6 | Ravi Mhatre | Lightspeed Venture Partners | |
7 | Josh Kopelman | First Round Capital | |
8 | Peter Fenton | Benchmark | |
9 | Nanpeng (Neil) Shen | Sequoia Capital (China) | |
10 | Steve Anderson | Baseline Ventures | |
11 | Fred Wilson | Union Square Ventures | |
12 | Kirsten Green | Forerunner Ventures | |
13 | Jeremy Liew | Lightspeed Venture Partners | |
14 | Neeraj Agrawal | Battery Ventures | |
15 | Michael Moritz | Sequoia Capital | |
16 | Danny Rimer | Index Ventures | |
17 | Aydin Senkut | Felicis Ventures | |
18 | Asheem Chandna | Greylock Partners | |
19 | Mitch Lasky | Benchmark | |
20 | Mary Meeker | Kleiner Perkins Caufield & Byers | |
21 | Roelof Botha | Sequoia Capital | |
22 | Peter Thiel | Founders Fund | |
23 | Michael Maples Jr. | Floodgate | |
24 | Nabeel Hyatt | Spark Capital | |
25 | Rebecca Lynn | Canvas Ventures | |
26 | Marc Andreessen | Andreessen Horowitz | |
27 | Matt Cohler | Benchmark | |
28 | Ping Li | Accel | |
29 | Scott Sandell | New Enterprise Associates | |
30 | Salil Deshpande | Bain Capital Ventures | |
31 | David Sze | Greylock Partners | |
32 | Ben Horowitz | Andreessen Horowitz | |
33 | Bijan Sabet | Spark Capital | |
34 | Jenny Lee | GGV Capital | |
35 | Bradley Feld | Foundry Group | |
36 | Sameer Gandhi | Accel | |
37 | Bryan Roberts | Venrock | |
38 | Douglas Leone | Sequoia Capital | |
39 | Promod Haque | Norwest Venture Partners | |
40 | Josh Stein | Draper Fisher Jurvetson | |
41 | Sandy Miller | Institutional Venture Partners | |
42 | Carl Gordon | OrbiMed Advisors | |
43 | Ted Schlein | Kleiner Perkins Caufield & Byers | |
44 | Randy Glein | DFJ Growth | |
45 | Ryan Sweeney | Accel | |
46 | Byron Deeter | Bessemer Venture Partners | |
47 | Navin Chaddha | Mayfield Fund | |
48 | George Zachary | CRV | |
49 | Mike Volpi | Index Ventures | |
50 | Michael Dearing | Harrison Metal | |
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