About VC: The Basics

Interested in Venture Capital? Read below to learn about the main companies in the industry and the basics of what they do.

VC Today

Within the last two decades, as startups have swarmed the economy, VC firms have increased in numbers as well. Venture Capital is defined as “independent and professionally managed, dedicated pools of capital that focus on equity or equity-linked investments in privately held, high growth companies.” A career in this field typically allows one to research businesses/companies, gauge their potential growth, and eventually decide whether or not one should provide funding. The positions in this field, listed from entry level to most senior are generally as follows: analyst, associate, principle, and partner.

Biggest Players in the Venture Capital Market

As of 2021, these are the biggest names in the industry:

Accel
Intel Capital
New Enterprise Associates
Insight Partners
Andreessen Horowitz
Benchmark
Index Ventures
Sequoia Capital
Bessemer Venture Partners
Founders Fund
GGV Capital
IPV

Sub-groups within Venture Capital

Within Venture Capital, there are several sub groups that companies operate within. Below are a couple examples:

Life-Science Venture Capital

These VC firms that focus on life-science areas such as bio-tech, pharmaceuticals, and medical devices.

Technology Venture Capital

These companies invest primarily in next-generation technology sectors such as artificial intelligence and machine learning software, virtual reality, and other related fields.

Types of VC Funding

Venture Capital firms offer start-ups several different types of funding.

Seed Capital

Before investors have a full-fleshed company, they can seek seed capital, which is a small investment to drive market research or administrative costs.

Startup Capital

Often this capital is used to hire new employees for the company or drive specific tasks in the early stages.

Early Stage Capital

This funding is provided two to three years in and can be used for a variety of reasons, including increasing product development or improving productivity.

Expansion Capital

For well established companies, VC firms provide this type of funding to finance marketing campaigns or other later-stage missions.

Late Stage Capital

Most of the companies which receive this funding have multiple levels of management.

Bridge Financing

This is allocated for acquisition or merger purposes, IPOs, and other major company changes.