Rather, they take a hands-on approach with all of their investments and actively work with entrepreneurial management teams in order to build great companies. The general partners have a fiduciary responsibility to their limited partners. There are approximately 693 venture capital firms in the United States. 2000 was a record year and such high investment levels are not expected to be sustainable considering the current economic uncertainty. However, based on past years and the current investment pace, investment levels for 2001 should be on par with 1998 and 1999 levels.
Venture capitalists invest in young and innovative companies that have great potential for growth.
Venture capitalists were instrumental in developing industries, such as the computer, biotechnology and the communications industries. Today, the majority of venture capital is invested in high technology companies. However, venture capitalists invest in all types of companies in many industry sectors. Venture capital activity has a significant impact on the U.S and global economies. Venture capital is a catalyst for job creation, innovation, technology advancement, international competitiveness and increased tax revenues.