Question

    Which of the following statements correctly distinguish

    Venture Capital (VC) from Private Equity (PE)? Venture Capital firms invest primarily in early-stage startups, whereas Private Equity firms invest in mature companies.   Private Equity investments generally involve taking full control of the company, while Venture Capital investments are typically minority stakes.   Private Equity focuses on long-term value creation through operational improvements, whereas Venture Capital focuses on high-growth potential companies .  
    A 1 and 2 only Correct Answer Incorrect Answer
    B 2 and 3 only Correct Answer Incorrect Answer
    C 1 and 3 only Correct Answer Incorrect Answer
    D 1, 2, and 3 Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Explanation:  

    • VC firms fund startups with high growth potential but high risk .  
    • PE firms invest in established companies , often restructuring operations for better returns.  
    • VC investments are minority stakes , whereas PE firms usually acquire controlling stakes to manage operations.  

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