Chapter 76 foreword

Venture capital is dealing with the smartest people in the world, and they are smarter people at the same time.The key to venture capital is to be able to accurately evaluate a technology and foresee the development trend of future technology.So some people say that venture capital is the best industry in the world. No company can start without capital.Traditionally, there are only two legal sources of entrepreneurial capital: one is through accumulation (such as inheritance or your own savings for many years), and the second is through borrowing (such as raising money from family members, relatives and friends, or mortgages from banks) loan).If entrepreneurs are required to take out all their life savings to start a business, many people may retreat in the face of difficulties, not to mention that the young people who like entrepreneurship the most are the group with the least savings.To get a loan from a bank, you must have property to mortgage. For those who have a house, the most valuable thing is the house, but once the house is mortgaged, it may not be redeemed, and you will be homeless, and not everyone has a house. mortgage.Therefore, it is not easy for young people to obtain venture capital through these two traditional methods.In this way, capital has become the bottleneck of entrepreneurship.In many countries, including almost all of Europe, few new companies are seen because no one is willing to provide the capital to start a business.

America is a young country full of adventure.After World War II, especially after the 1960s, some investors who were willing to exchange high risks for high returns invented an unconventional investment method—Venture Capital Investment (or VC), also referred to as venture capital in China.Venture capital is fundamentally different from traditional loans that require collateral.Venture capital does not require collateral and does not require repayment.If the investment is successful, the venture capitalists will get several times, dozens of times or even hundreds of times in return; if not, the money will be wasted.For entrepreneurs, even if they fail to start a business with venture capital, they will not be in debt.This makes it possible for young people to start a business.For decades, this investment method has generally been very successful. While Silicon Valley created the myth of technology companies, it also created another myth-the myth of investment.