NCPA - Economic Issues - Venture Capital For Good Ideas

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Venture Capital For Good Ideas

An abundance of venture capital is available to entrepreneurs who have a better idea, say observers.

Private investors contribute $20 billion annually to start-up companies.
In 1996, the venture capital industry produced a 40 percent return on investments -- about double that of the S&P 500 index.
That performance helped venture capital funds raise $16.5 billion over 1996 and 1997.

While there were few venture capital firms in the past and many promising ideas had to be abandoned for lack of funding, today there is so much money chasing after the next good idea that entrepreneurs with a decent product hold the upper hand, experts report. For them, observers say, this is probably the greatest time to be alive.

Source: Eileen P. Gunn, "Would You Please Take My Money?" Fortune, March 16, 1998.

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