Risk Capital 

Risk Capital refers to the funds invested in high-risk, high-reward ventures such as startups, early-stage companies, or speculative investments. It represents capital where the risk of loss is substantial, but so is the potential for above-average returns. 

Venture capital, angel investments, and private equity are common forms of risk capital. Unlike secured loans or bonds, risk capital is typically unsecured and subordinate to other financial obligations, making it riskier but potentially more lucrative if the venture succeeds. 

Investors providing risk capital often seek: 

• Equity stakes. 

• Convertible notes. 

• Preferred shares with special rights and liquidation preferences. 

Risk capital fuels innovation, business formation, and market expansion, especially in industries like technology, biotech, and clean energy.