Money invested in young, risky companies in exchange for ownership and the chance of a much bigger payback later.
Example
A fund gives a two-year-old startup $1 million for 20% ownership. They expect most of their bets to fail. They are betting that one in ten will grow so much that the winner pays for all the others, and then some.
How it fits in
Venture capital firms accept that most of their bets will not work. They bet that a small number of huge winners will more than make up for the losers. This shapes the kind of business they fund (large markets, scalable models, defensible advantages) and the pressure they put on founders to grow quickly. Not every business needs venture capital. Many lasting profitable businesses never raise it at all.
Where this is taught
Related terms
When the money you earn from saving starts earning its own money on top.
Interest paid only on the original amount, never on the interest you have already earned.
Needs are the things that keep you safe and well. Wants make life nicer. Mixing them up is what empties most budgets.