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Venture Capitalist  What They Do

Just the Facts

Insider Info

dotVenture capitalists finance the start-up, development, expansion, restructuring or acquisition of companies. They're the engines of growth in today's cutting-edge industries.

They study companies using a three-step process. They look at the market involved -- whether it's computers, entertainment, agriculture or another field. Then they become familiar with the management team of the company they're considering investing money in.

Finally, they evaluate the company's products to see if an opportunity exists for business growth. And the product should be unique.

dotVenture capitalists give medium- or long-term financing to a company. This may include bonds or loans that may, in turn, let them share in the particular company's capital. Sources of venture capital include individuals, private firms, organizations or government programs.

dotThese investment sharks aren't passive. They participate in the companies they invest in and guide them toward increased growth. They handle investments of a few million dollars up to over a billion dollars.

dotU.S. high-tech industries are common markets for venture capitalists. Venture capitalists also invest in agriculture, industrial products, entertainment, construction, business services, retail companies and more. Some are involved in start-up ventures that are geared toward social responsibility.

dotThese investors are employed by private firms, commercial banks, industrial corporations and even government-related programs which help boost the start up of new companies through state, local or federal programs.

At a Glance

Pick new companies to invest in

  • These professionals can handle investments of over a billion dollars
  • They can work for private firms, banks, industry and government
  • An MBA plus plenty of industry experience is good preparation