A firm that raises money so that it can invest in new firms by buying most of th

Question

A firm that raises money so that it can invest in new firms by buying most of the equity in that new firm from the firm rather than through a stock exchange is called a?
A) Venture capital firm B) Angle investor C) Institutional investor D) Underwriter


A firm that raises money so that it can invest in new firms by buying most of the equity in that new firm from the firm rather than through a stock exchange is called a?
A) Venture capital firm B) Angle investor C) Institutional investor D) Underwriter



A) Venture capital firm B) Angle investor C) Institutional investor D) Underwriter

Explanation / Answer

Hi,

The correct answer is option (A), Venture capital firm

Explanation: Venture Capital is money provided by investors to startup firms and small businesses with perceived long-term growth potential. This is a very important source of funding for startups that do not have access to capital markets. It typically entails high risk for the investor, but it has the potential for above-average returns

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