VCs typically aim for a return of at least ten times their initial investment over five to seven years. If a VC invests $5 million in a startup, it would expect to receive at least $50 million upon a successful exit, such as an acquisition or an initial public offering (IPO). Private equity firms and hedge funds benefit from several controversial provisions in the current U.S. tax code. Critics refer to these special tax breaks as loopholes, while defenders justify them as a fair means of rewarding risk. Here is how private equity and hedge funds are taxed. More information https://financial-equity.com/investment/invest-in-stocks/can-you-lose-more-than-you-invest-in-stocks-understanding-risk-in-the-stock-market/ Successful investment ventures typically have a strong management team, large market potential and a unique and competitive product. Rebecca Baldridge Investing Writer.