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Benchmark: The Venture-Capital Difference

Three graphs display averages that suggest venture capital helps companies in ways not originally expected.

By Jill Andresky Fraser | 
 

Louise Short of Digital Impact (see "Making the Most of a VC Forum," [Article link]) sought venture capital to fund growth. But a recent survey reveals that venture capital helps companies in additional ways, as illustrated by key comparisons to Fortune 500 companies.

Venture-backed Fortune 500

companies companies

Average annual research-and-development growth rate (1989-1993) 35% 9%

Average annual sales-per-employee growth rate (1989-1993) 12% 5%

Average investment in capital equipment as a percentage of revenues (1989-1993) 23% 7%

Source: "Fifth Annual Economic Impact of Venture Capital Study," Coopers & Lybrand, New York City, March 1995.

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