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Venture Capital and Equity Funds

Hands holding stacks of cashThe terms ‘Venture Capital’ and ‘Angel Investor’ are often confused. Both receive equity (basically shares in a company that is not publicly traded), from providing investments into private companies, but there are several differences.

Angel Investors can be an individual or a group of individuals that form an ‘angel fund’ and who are investing their own personal funds into a business. They may be more willing to invest in early stage companies, and the amount of investment will typically be less than you would see through a Venture Capital investment.

Venture Capital funds are managed through venture capital firms primarily made up of professional investors. The funds come through many different sources including individual investors, corporations and other. The types of business funded are small and medium sized ventures with a strong growth potential, and the investments are typically characterized as high-risk/high return opportunities.

Iowa Capital Investment Corporation, a state chartered independent not-for-profit corporation, maintains a listing of venture capital and angel/seed funds serving Iowa and has organized the Iowa Seed and Angel Network, a group of individual investment groups from across Iowa who meet quarterly to hear from companies seeking investment.


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