Venture capital versus private equity – which will work best for your business?
Venture capitalists typically invest in early-stage companies, often start-ups that are in the initial phases of development. The capital typically is invested into the company to facilitate the future growth of the business.
Venture capital (VC) and private equity (PE) play increasingly important roles in the funding landscape but are not to be confused with each other.
“VC typically invests in early-stage companies, often start-ups that are in the initial phases of development,” says James Toomey, partner, financial advisory, Deloitte. “These companies usually have high growth potential but may not yet be profitable. The capital typically is invested into the company to facilitate the future growth of the business, with limited, if any, cash paid out to shareholders.”
