The way Venture Capital funds make money are two fold: via management fees and carries (carried interest).
VC funds typically pay an annual management fee to the fund’s management company, as a form of salary and a way to cover organizational and fund expenses.
How much does a venture capitalist get paid?
Average Total Cash Compensation
The base salary for Venture Capitalist I ranges from $135,491 to $224,915 with the average base salary of $184,894. The total cash compensation, which includes base, and annual incentives, can vary anywhere from $149,348 to $272,131 with the average total cash compensation of $210,032.
Does venture capital have to be paid back?
The money is then paid back to the venture capital firm, with interest. Sometimes, the money is repaid through shares of stock in the company. Venture capital firms are excellent places for start up businesses who are not able to get funding for their growth through another source.
What makes a good venture capitalist?
Its a combination of innate skills (optimism, judgment, comfort in ambiguity) combined with real world experience. “Good instinct, well honed by experience makes a good venture capitalist. “It really pays off to come into venture capital after you’ve had a fair amount of experience doing something else.