Given some of the hyperbole and lunacy that's been put forward on USMB about Mitt Romney's background as a venture capitalist, I thought I'd try and give y'all a non-partisan, rational overview of what venture capitalism is, it's benefits, and the downside. In a nutshell, venture capitalist provide an injection of capital (finance, money, cash, bucks) into a company that has a business need for that capital. It is an alternative to a bank loan. Sometimes companies approach venture capitalists because the bank won't lend, or because they can't get a decent interest rate from a bank. Often it is used to develop a new product, invest in better equipment or technology. Venture capital companies are also known as private equity companies (although there are some slight differences between the two), or, in the case of an individual venture capitalist, they are often nicknamed 'business angels'. Most venture capital companies lend in specific markets, in which they have some form of expertise, so by partnering with a venture capital company, the business not only gets an injection of money, it also has access to the venture capitalist's expertise and experience. Venture capital companies also often invest in high risk start up businesses that banks have refused loans due to the high risk, or companies that are failing - often due more to internal issues, such as incompetent management. In those instances, the venture capital company may remove the management and replace them with more experienced staff. More often than not, the investment made by the venture capital company benefits the recipient company. The venture capital company owns a share - and makes money, and the recipient reaps their own financial reward.... the workers have jobs, the owner has their profit and everyone is happy. Once in a while, it does not work and the venture capital company will sell off the assets of the company in order to recoup some or all of its investment. Sometimes they also make a profit on that. Clearly, the subject is far more complex than I have outlined - but.... that's a basic overview. I hope it helps clarify the benefits - and the downside. If you want to see 'venture capital' in action, watch the program 'Shark Tank'... that is individual 'venture capital' in a nutshell.