Venture Capital (VC) is a vital funding source for high-growth startups, typically those too risky for traditional bank loans. VCs pool capital from Limited Partners (LPs) to invest in promising early-stage companies with significant scaling potential. In exchange, they receive equity, aiming for substantial returns through an "exit" (IPO or acquisition). Startup funding progresses through distinct stages: Pre-Seed/Seed: Initial capital from founders, friends & family, or angel investors to validate ideas and build a Minimum Viable Product (MVP) Series A: The first major VC round, focusing on refining product-market fit and user acquisition Series B, C, and Beyond: Subsequent rounds for scaling operations, market expansion, and preparing for an exit Benefits of VC: Beyond capital, VCs offer invaluable mentorship, strategic guidance, industry networks, and credibility, accelerating growth Risks for Founders: Dilution of ownership, pressure for rapid growth, potential loss of control
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