Definition

Noun: - Money invested in a business venture that has a high chance of failure but also the potential for significant profit: This is capital provided for startup companies or new projects that are considered very risky. The investor accepts the possibility of losing all the money in exchange for the possibility of high returns.

Usage

"Risk capital" is used to describe funds specifically allocated for high-risk, high-reward investments. It is a formal financial and business term. - It is typically provided by venture capitalists, angel investors, or specialized funds. - The term emphasizes the speculative nature of the investment.

Examples

• The tech startup secured $2 million in risk capital from a group of venture capitalists.
• Entrepreneurs often struggle to find risk capital for their innovative but unproven ideas.
• Investing his personal savings as risk capital, he launched his first company.

Advanced Usage

• "To provide/secure risk capital": This is a common collocation describing the action of supplying or obtaining this type of funding.
  • The firm's role is to provide risk capital to promising biotechnology ventures.

Variants and Related Words

• Venture capital (n): This is a very close synonym, often used interchangeably with "risk capital," though "venture capital" often implies a more institutional source.
• Speculative capital (n): Another synonym highlighting the speculative nature of the investment.
• Angel investment (n): A type of risk capital provided by affluent individuals (angel investors) in the early stages of a startup.

Synonyms

• Venture capital
• Speculative capital
• Startup funding

Related Idioms/Phrases

• "To have skin in the game": While not a direct synonym, this idiom relates to having personal capital at risk in an endeavor, similar to providing risk capital.
  • The founder has a lot of skin in the game, having invested most of his personal risk capital.

Noun

1. wealth available for investment in new or speculative enterprises