Glossary
Venture capital
Equity investing in private, high-growth-potential companies, typically structured through closed-end funds with a long investment and harvest period.
Why it matters
Venture capital is illiquid, concentrated, and power-law distributed. Understanding the structure is the foundation for evaluating any LP commitment.
Example
A venture fund commits capital across 25 early-stage companies over four years, expecting that a small number will drive the majority of returns.