Definition

Funding provided by investors to startups and small businesses with high growth potential in exchange for equity.

What to consider

  • Research venture capital firms and what they offer.
  • Consider the trade-offs between equity dilution and growth potential.
  • Evaluate if the investor’s experience aligns with your business goals.

Real world scenarios

  • When launching her innovative app, Laura pitched her idea to venture capital firms in hopes of securing the funding needed to scale her business.

Related terms

Investments & Retirement