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Chapter 1.1: Introduction to Venture Capital

Check out the abridged and reformatted version of the first chapter of Joe Bartlett's E-Book on the world of venture capitalism, fundraising, private capital, and more! Stay tuned as we continue to reformat his chapters into easy-to-digest slides.

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Chapter 1.1: Introduction to Venture Capital

  1. 1. Chapter: 1.1 Introduction to Venture Capital
  2. 2. 1 Confounding many of its critics, the American economy is outstripping the economies of its sister industrial nations by an astonishing margin. What is going on here? We are not the richest nation in terms of natural resources We run a balance-of-payments deficit year in and year out and, until recently, a deficit in our own internal accounts. Other indices, infant mortality, for example, and secondary education are not wholly favorable. What constitutes the critical distinction? The difference lies in a confluence of happy factors, some created by design (and some serendipitous) under the heading of "Venture Capital." Entrepreneurs, investors, scientists, and key managers have coalesced in various hot spots around this country over the past forty years to incubate new firms.
  3. 3. 2 Small Business Powers Our Economy The crowning glory of small business is the venture-backed sector, from "the embryo to the IPO." Our future lies in what MIT's David Burch calls "gazelle companies," i.e., "young enterprises with pioneering ideas that quickly grow into big companies." [1] These are the firms where founders, from the start, are driving for major league status. Generally, although not exclusively, they are tech driven [2] and venture capital backed … [1] Andrews, "Where Do The Jobs Come From?." New York Times, G-1 (Sep. 21, 2004). "Gazelles" are referred to as "innovator firms" by Prof. Megginson. Megginson, "Toward a Global Model of Venture Capital," VC Experts Buzz of the Week, 8/10/2004. [2] Note, innovation needn't be tech-centric; we all relied on the Post Office to deliver the mail, until Fred Smith came up with Federal Express. But, by and large, tech drives the venture market … computer hardware, software, biotech, information technology … and then robotics, nano-tech, quantum computing, gene therapy, und so weiter. This valuable information was originally published by Joseph Bartlett, Founder and Chairman of VC Experts. If you are looking for more information on venture capital and private equity please visit and check out our Intelligence Database and Reference Material. VC, Inc. Disclaimer: The information contained herein is from sources deemed reliable; it does not, however, purport to constitute investment advice nor does VC Experts represent that it contains all information concerning the identified Company deemed necessary or appropriate for investment decisions. VC Experts is neither a broker/dealer nor investment adviser and has no financial interest in the Company analyzed nor in the sale or purchase of any of its securities. The information and data are for reference purposes only and no implied or expressed warranties or assurances as to its accuracy or completeness are furnished by VC Experts. Estimates of valuation are, as indicated, estimates based on such information as we found available, the completeness of which is neither represented or guaranteed; users for any purpose are cautioned and required to undertake and perform their own investigations and due diligence. To the extent that the information incorporates content from specified sources of financial information, VC Experts disclaims any responsibility for the accuracy or completeness of such content. About VC, Inc.: VC provides specialized content, valuation & term sheet data on thousands of venture capital financing events, and analytics for managing & modeling private company capital structures. Visit for more information.