Can someone explain the difference between Venture Capitalism and Private Equity?

Question

Can someone explain the difference between Venture Capitalism and Private Equity? As a matter of of fact, what is VCPE?

Answer 1

venture capital is an investment meant to help get a promising company off the ground.  once the company has some track record of profitability and goes public, the vc's make the bulk of their return, though they often chose to retain some ownership interest.  some of the other answers here seem to forget that vc is not angel investing, and does not usually provide seed capital.  vc's give the company cash to invest in itself, and the founders a bit of a payoff.

private equity is an investment wherein an  investment firm takes a public company private, where it is solely owned by the fund's investors.  typically, the goal is to clean up the balance sheet or management, and take the company public again a few years down the line.

Answer 2

Venture Capital is usually first in the timescale of investment, maybe seed capital. Private equity comes a bit later in the company's life cycle, say  just before a SE floatation.

Answer 3

Venture capital is merely a type of private equity.  Venture capital comes at the very beginning of a new company's life. It's provided by some type of professional, or an investor who is looking to take some piece of the new company if it really takes off.  The downside if you are the [owner] of the company, is that the investors still have a lot of the say in the desicions of the fledgeling company.

Private equity is just an asset class of equity securities on a company that is not publicly traded.

There is essentially no difference except that venture capitialism is the investment of money while the company is still starting up.