Venture Capital
Also known as: VC, Venture Investment
Institutional equity investment in high-growth potential companies in exchange for ownership stake.
Full Definition
Venture capital funds invest in early and growth-stage companies with the expectation of high returns through eventual exit — either acquisition or IPO. Healthcare venture capital is characterized by long hold periods (7–12 years), high capital requirements (particularly for device companies requiring clinical trials), and significant regulatory and reimbursement risk. VC investors evaluate investments on team quality, market size, technology differentiation, regulatory pathway, and business model defensibility.
Example
A HealthTech startup receives a $15M Series A from a healthcare-focused venture fund. The fund takes a board seat, provides strategic guidance on regulatory and commercial strategy, and expects a 5–7x return through strategic acquisition within 8 years.