![101 on How VC Industry Works [Must Read for all you Entrepreneurs]](http://www.pluggd.in/wp-content/uploads/2009/11/don-corleone.jpg)
Many first time entrepreneurs may not fully understand how a venture capital fund works and consequently may not fully relate to how VC’s function. This post makes an attempt to provide a generic overview of how a VC fund functions and what it implies for entrepreneurs.
To start with, it would help to understand similarities between VC’s and entrepreneurs. Just as entrepreneurs go through the cycles of opportunity, business plan, fund raising and eventual exit through IPO or M&A, VC’s also follow a similar cycle. VC’s identify the opportunity space in which they want to play and then develop a business plan.
