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Venture Capital
Venture capital (VC) is a form of private equity financing that is provided by venture capital firms or funds to startups, early-stage, and emerging companies that have been deemed to have high growth potential or which have demonstrated high growth (in terms of number of employees, annual revenue, scale of operations, etc). Venture capital firms or funds invest in these early-stage companies in exchange for equity, or an ownership stake. Venture capitalists take on the risk of financing risky start-ups in the hopes that some of the firms they support will become successful. Because startups face high uncertainty,[1] VC investments have high rates of failure. The start-ups are usually based on an innovative technology or business model and they are usually from the high technology industries, such as information technology (IT), clean technology or biotechnology.
The typical venture capital investment occurs after an initial “seed funding” round. The first round of institutional venture capital to fund growth is called the Series A round. Venture capitalists provide this financing in the interest of generating a return through an eventual “exit” event, such as the company selling shares to the public for the first time in an initial public offering (IPO) or doing a merger and acquisition (also known as a “trade sale”) of the company. Alternatively, an exit may come about via the private equity secondary market.
In addition to angel investing, equity crowdfunding and other seed funding options, venture capital is attractive for new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering. In exchange for the high risk that venture capitalists assume by investing in smaller and early-stage companies, venture capitalists usually get significant control over company decisions, in addition to a significant portion of the companies’ ownership (and consequently value). Start-ups like Uber, Airbnb, Flipkart, Xiaomi & Didi Chuxing are highly valued startups, commonly known as “Unicorns”, where venture capitalists contribute more than financing to these early-stage firms; they also often provide strategic advice to the firm’s executives on its business model and marketing strategies.
Venture capital is also a way in which the private and public sectors can construct an institution that systematically creates business networks for the new firms and industries so that they can progress and develop. This institution helps identify promising new firms and provide them with finance, technical expertise, mentoring, talent acquisition, strategic partnership, marketing “know-how”, and business models. Once integrated into the business network, these firms are more likely to succeed, as they become “nodes” in the search networks for designing and building products in their domain.[2] However, venture capitalists’ decisions are often biased, exhibiting for instance overconfidence and illusion of control, much like entrepreneurial decisions in general.[3]
Blaine
Blaine is a city in Anoka county in the State of Minnesota. The population was 57,186 at the 2010 census.[5] The city is located mainly in Anoka County, and is part of the Minneapolis–Saint Paul metropolitan area.
Interstate Highway 35W, U.S. Highway 10, and Minnesota State Highway 65 are three of the main routes in the city.
Until 1877, Blaine was part of the city of Anoka, Minnesota. Phillip Laddy, a native of Ireland, is recognized as the first settler in Blaine and settled near a lake that now bears his name, Laddie Lake, in 1862. Laddy died shortly after his arrival and his survivors moved on to Minneapolis. Another early settler was the Englishman George Townsend, who lived for a short time near what would today be Lever St. and 103rd Ave.