Venture Capital

Venture capital is money professional investors put into young, often unprofitable companies with high growth potential, in exchange for equity, a partial ownership stake, rather than a loan to be repaid. It's a high-risk, high-reward game: most funded startups fail entirely, but the rare hit, the next major tech company, can return enough to cover all the losses many times over. A slowdown in venture funding tends to ripple through the tech industry with a lag, showing up later as layoffs and startup shutdowns once the money already raised runs out.