How Does Venture Capital Work?
The video defines it as money from firms specialising in early stage funding in return for a stake, also called equity (OpenStax).
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1.What is venture capital?
The video defines it as money from firms specialising in early stage funding in return for a stake, also called equity (OpenStax).
2.What does a stake or equity mean?
A stake means part ownership: if the company grows, the stake grows with it.
3.Who commits money to a venture fund, according to the video?
The chain runs from investors, to a fund, to a young company (Hall and Woodward 2008).
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Sources (5)
- OpenStax: Entrepreneurship, Abschnitt 9.1 Overview of Entrepreneurial Finance and Accounting Strategies
- Hall, R. E., Woodward, S. E.: The Burden of the Nondiversifiable Risk of Entrepreneurship, NBER Working Paper 14219 (August 2008); erschienen American Economic Review 100(3), 2010, S. 1163-1194
- Mulcahy, D., Weeks, B., Bradley, H. S. (Ewing Marion Kauffman Foundation): "We Have Met the Enemy... and He Is Us", May 2012
- Harris, R. S., Jenkinson, T., Kaplan, S. N.: Private Equity Performance: What Do We Know?, NBER Working Paper 17874 (February 2012); Journal of Finance 69(5), 2014
- Eigene Rechnungen: Portfolio
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