Which term refers to individual investors or investment firms that invest venture capital professionally?

• A. Trade Credit
• B. Angel
• C. Venture Capitalists
• D. Equity Capital

Answer: (C)

Venture capitalists are professional investors who operate venture-capital funds, pooling capital from limited partners to invest in high-growth startups. They don’t just provide money; they also offer strategic guidance, governance, and valuable industry connections, aiming for substantial returns through equity ownership and eventual exits like acquisitions or IPOs. This makes them the professional class of investors who manage venture funding. Trade credit is a short-term financing arrangement between businesses, not investment in startups. Angels are individual investors who put their own money into early-stage ventures, rather than professional funds. Equity capital refers to the funding itself or the equity stake, not the professional investors who manage the funds.