captive VC

Definition

A venture capital fund owned and operated by a larger corporation to invest in strategically relevant startups. They bring money and potential acquisition interest, but everyone knows who they're really working for.

Example Usage

Taking money from Google Ventures is great until you realize you've got a captive VC on your board when Microsoft wants to acquire you.

Origin

Corporate venture capital terminology, emerged in 1990s as large tech companies launched investment arms

Fun Fact

Startups backed by captive VCs are significantly more likely to be acquired by their investor's parent company—coincidence?

Source: Venture capital industry terminology

Related Terms

Beginner

GP

General Partner, the VC fund managers who make investment decisions and carry legal liability for the fund's operations. They're the ones whose names are on the door and whose reputations are on the line.

🚀 Startup / VC

Beginner

Elevator Pitch

A 30-second summary of your startup that you deliver to investors in elevators, coffee lines, and restraining-order-adjacent proximity. If you can't explain your company in the time it takes to ride an elevator, your company is either too complicated or the elevator is too fast.

🚀 Startup / VC

Intermediate

pattern matching

When VCs make investment decisions based on superficial similarities to previous successful startups rather than rigorous analysis. It's why they love Stanford dropouts building social apps in their dorm rooms.

🚀 Startup / VC

Intermediate

vested

The magical moment when stock options or retirement contributions officially become yours to keep, transforming from corporate dangling carrot into actual ownership. It's the golden handcuffs' lock clicking shut, ensuring you'll think twice before rage-quitting. The startup world's version of 'you must be this loyal to ride this rocket ship.'

🚀 Startup / VC

Intermediate

revenue multiple

A valuation metric calculated by dividing company valuation by annual revenue, popular in tech because it works even when profits are mythical. Allows investors to justify astronomical valuations by citing "industry standards."

🚀 Startup / VC

Intermediate

Cliff

The initial period before any stock options vest, typically one year, during which employees own exactly nothing and question all their life choices. It's called a cliff because if you leave before it, you fall off the edge of ownership into the abyss of having worked for below-market salary for nothing.

🚀 Startup / VC

Translate This Term

See “captive VC” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.

Try the Translator

Share This Term

Post on X Share on Facebook Share on LinkedIn

Discover a Term

Beginner

Fat Sam

In the film Bugsy Malone, one of the main Characters is Fat Sam Fat Sam is the owner of Fat Sam's Grand Slam Speakeasy ...