Why in the news
Retail investors are tilting towards bonds as equities swing and FD rates flatten, which is catching venture capital firms’ attention.
What is venture capital
- Funding for small, high-potential firms; investors get ownership equity.
- Handy when a startup cannot tap markets, banks or ordinary debt.
| Stage | Purpose |
|---|
| Pre-seed | Idea becomes a plan; incubators help |
| Seed | First product launch, little revenue |
| Early stage | Scale output, marketing, sales; Series A, B, C |
VC versus PE
| Parameter | VC | PE |
|---|
| Target | Startups | Mature businesses |
| Risk | High | Moderate to low |
| Stake | Minority | Often majority |
| Focus | Innovation, growth | Restructuring, profit |