One of the biggest hurdles for new businesses is securing startup funding. One solution for many is to secure venture capital. According to the National Venture Capital Association, companies that received venture financing between 1970 and 2003 accounted for 10.1 million jobs and $1.8 trillion in revenue in 2003. This represented approximately 9.4% of total U.S. jobs and revenues.
Several prominent companies have received venture financing during their growth phases including: Microsoft, FederalExpress, AOL, Apple, Office Depot, Intel, Home Depot, Cisco, Compaq, Genentech, Amgen, Starbucks e-Bay and Google.
Highlights from a Global Insight study released in 2004 showed that:
(1) Venture-backed companies do better in creating jobs and revenue growth when compared to their U.S. private company counter-parts in 10 separate industries.
(2) Venture-backed companies grow faster than their national industry counterparts, and also experience higher employment growth.
(3) Venture capital investment has been the strongest in the last three decades in California, Texas, and Massachusetts producing the most jobs and revenues for the country.
(4) 72% the entire world’s total VC dollars were invested in U.S. companies.
(5) The U.S. venture capital industry supports more than 40% of the companies entering the public market via IPOs.
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