Venture-Backed Companies Help Power U.S. Economy

Funds created 10 million jobs from 1970-2005

Venture capital is making its mark on the U.S. economy, a recent study shows. U.S. companies that received venture capital from 1970 through 2005 accounted for 10 million jobs and $2.1 trillion in revenues in 2005, according to a study issued by the National Venture Capital Association. Those numbers represent 9% of the total private-sector workforce and 16.6% of total U.S. GDP.

Additionally, venture-backed firms outperformed their non-venture counterparts between 2003 and 2005, with a 4.1% compound annual growth rate (CAGR) in jobs and an 11.3% CAGR in sales versus total private-sector growth rates of 1.3% and 8.5%, respectively, the study shows.

"Since we first measured venture capital's impact on the U.S. economy in 2000, we have seen that venture-backed companies consistently outperform their non-ventured counterparts for job creation and revenue generation," says Mark Lauritano, a managing director with economic research firm Global Insight, which conducted the study.

Well-known venture-backed companies include Intel, Genentech and Apple.

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