Word of the Day: Venture capital

The long-term financial assistance to projects being set up to introduce new products/ inventions/innovations or to employ or commercialize new technologies is known as Venture Capital.

Thus, venture capital entails high risk but has the promise of attractive returns. It is, therefore, also known as 'Risk Capital'.
The role of venture capital institutions is very important to the economic growth of a nation. Because of their assistance, new entrepreneurs and businesses spring up and contribute significantly to the total wealth of a nation. In India, such institutions have been set up at the national and state levels.


Examples include Technology Development and Information Company of India Limited (TDICI), Risk Capital and Technology Finance Corporation Limited (RCTFC) and Gujarat Venture Finance Limited (GVFL).