Venture Capitalist

Definition

A professional investor who gives large sums of money to startups in exchange for equity and a seat on the board. They're part advisor, part critic, part gambler.

Example Usage

Our lead VC is an expert in enterprise software, though she's mainly given us unsolicited advice about pivoting to AI.

Origin

Combined term 'venture' (risky business) and 'capitalist' (investor); formal usage from post-WWII investment banking

Fun Fact

Top-tier VCs have a success rate of maybe 30-40%; even they get it wrong 60-70% of the time.

Source: Venture capital industry terminology

Related Terms

Intermediate

impetus

The driving force or stimulus that gets something moving, whether it's a business initiative, social movement, or your motivation to finally start that side project. In startup land, it's whatever convinces founders they can disrupt an industry, usually a personal pain point or too much coffee. Think of it as the corporate equivalent of "what sparked this terrible/brilliant idea?"

🚀 Startup / VC

Intermediate

triple down

When a VC aggressively increases their investment in a portfolio company across multiple rounds, betting their career on being right. Conviction investing taken to its logical extreme.

🚀 Startup / VC

Intermediate

party round

A funding round with so many small investors that the cap table looks like a nightclub guest list—lots of names, minimal commitment from anyone. Usually signals either a hot deal everyone wants a piece of, or a desperate founder who couldn't land a lead investor.

🚀 Startup / VC

Intermediate

Networking Effect (Network Effect)

When a product becomes more valuable as more people use it, creating a virtuous cycle of growth. It's the holy grail of startups because it creates defensibility that's hard to compete against.

🚀 Startup / VC

Intermediate

deployment velocity

The speed at which a venture fund invests its committed capital, often scrutinized as a metric of both deal flow quality and fund discipline. Too slow suggests weak deal flow; too fast suggests poor judgment and FOMO.

🚀 Startup / VC

Advanced

Reg D

An SEC regulation allowing private companies to raise money from unlimited accredited investors without formal SEC registration. It's basically the loophole that makes startup funding possible.

🚀 Startup / VC

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