The U.S. venturecapital(VC) industry has traditionally played an important role by providing guidance and risk capital required for building high-growth companies.
The problem is that taxing Carried Interest as capital gains for early stage venturecapital(VC) firms is not a loophole but is essential for starting new companies and spurring job creation.
Short Definition : VentureCapital(VC) Funding is an investment fund that manages money from investors who are seeking private equity stakes in startups and small to medium sized firms with strong growth potential.
For example, the consumer industry accounts for nearly 15% of GDP but less than 5% of venturecapital funding, yet according to a report by the Kaufmann Foundation, the leading authority on VC and angel investing returns, angel investments in consumer products companies have produced average returns of 3 .6x invested capital over 4.4 years.
If you take a look at the Big Data tab of CrunchAnalytics, you can see that VC investments in big data followed the same downward trend, with the peak of venturecapital funds raised by big data startups occurring in 2010.
Venturecapital is one of those rare businesses where past results are indicative of future results, as success in VC creates a virtual cycle: a VC backs a start-up, the start-up is a huge success and generates publicity- both for the start-up and for the VC.