How venture capitalists make money

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In previous articles we discussed the financing options available to startups and also the criteria used by investors when deciding which startups to back. There are two key elements within a VC fund: The general partners are the people in charge of making investment decisions finding and agreeing to terms with startups and companies and working with startups to grow and meet their goals.

On the other hand there are limited partners, the people and organizations who provide the capital necessary to complete those investments. Startups need to fundraise to convince Venture Capital firms, business angels, etc to give them money in exchange for equity.

53 Startups That Will Take Off in , According to Silicon Valley's Top Venture Capitalists | qyzofolawory.web.fc2.com

The case for VC firms is similar. General partners must convince some of the organizations aforementioned to invest in the fund with the promise of big returns between 5X and 10X in a certain period of time usually 10 years.

National Venture Capital Association - NVCA

The VC firms must then go on to make clever investments so they can give the limited partners their money back… plus a profit. After that the firms will work alongside the startups and founders to scale and seek an exit, providing the returns that they sought in the first place.

Sign up to Startupxplore, the startup funding community! El talento ya no se capta con billetes. How does a Venture Capital firm work?

In other words, general partners make the investments and limited partners provide the funds. Looking for VC in Spain?

Spain, startups and success is a good combination. Here are 4 examples.

Six Mistakes Entrepreneurs Make When Seeking Venture Capital

Understanding differences in startup financing stages. How opening up to the world changed the Berlin startup ecosystem: Join more than 9, outstanding companies The startups and investors community.

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