Venture Capital Investors Play the Odds

                       

The Wall Street Journal reported that, of the 6,613 U.S, based companies that were initially funded by venture capitalists in their “hot” years from 2006 through 2011, 11% were acquired or had IPOs. In other words, they could be considered, in my estimation, to be successful deals as venture capitalists see it.

                                   

                       

About 84% were independent and still operating, and the 5% left went out of business.

                       

What was not said was that those 84% or so had to include many struggling independents. The exit strategy for venture capitalists is to be acquired or to go public in about five years for a big payoff,

                       

That 11% figure for IPO or acquision must include a big winner.

(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)