Minneapolis Daily Review:
Venture capital (VC) is financial capital. (http://en.wikipedia.org/wiki/Financial_capital) Provided to early-stage, high-potential, high risk, growth (http://en.wikipedia.org/wiki/Growth_investing) startup companies (http://en.wikipedia.org/wiki/Startup_company) .
The venture capital fund (http://en.wikipedia.org/wiki/Collective_investment_scheme) makes money by owning equity (http://en.wikipedia.org/wiki/Equity_%28finance%29) in the companies it invests in, which usually have a novel technology or business model (http://en.wikipedia.org/wiki/Business_model) in high technology industries, such as biotechnology (http://en.wikipedia.org/wiki/Biotechnology) , IT http://en.wikipedia.org/wiki/Information_technology) , software (http://en.wikipedia.org/wiki/Software) , etc.
The typical venture capital investment occurs after the seed funding (http://en.wikipedia.org/wiki/Seed_funding) round as growth funding round (also referred to as Series A round (http://en.wikipedia.org/wiki/Series_A_round) ) in the interest of generating a return through an eventual realization event, such as an IPO (http://en.wikipedia.org/wiki/Initial_public_offering) or trade sale (http://en.wikipedia.org/wiki/Mergers_and_acquisitions) of the company.
Venture capital is a subset of private equity (http://en.wikipedia.org/wiki/Private_equity) . Therefore, all venture capital is private equity, but not all private equity is venture capital. (http://en.wikipedia.org/wiki/Venture_capital#cite_note-PrivCo-0)