Venture Capital Definition

Venture Capital is a fund backed by Limited Partners.  The Limited Partners put up the money for the fund.  Venture Capitalists are then hired to manage the fund.  Venture Capitalists often find the Limited Partners and raise the fund themselves.  The Venture Capitalist’s job is to find quality early stage investments to fund.  The fund is managed like a portfolio, similar to a stock portfolio.  The primary difference between Angel Investors and Venture Capitalists is that the VC is typically not investing their own money.  Also being a Venture Capitalist is a full time job, where Angel Investors typically invest on the side.