Private Equity vs Venture Capital

Private Equity vs Venture Capital

Private equity is composed of funds from institutional investors and high networth individuals for long term investment in private companies or for acquiring control of distressed and non profit making public companies. PE funds look to invest in mature companies that have well established businesses with the object of turning them around. Venture capital is a form of financing that is provided by venture capitalist firms to small, early-stage, emerging firms that have high growth potential. The venture capital firm gives funding to the startup company in exchange for an equity stake.