Invest Like a Venture Capitalist

So, What's the Next VC Frontier?

Over the past several years, the business world has seen a resurgence of interest in tech-based start-ups. Investments from VC firms have increased 33% since the post-bubble lows of 2003, suggesting to investors that more tech stock offerings may be on the horizon.

Companies that are making moves include players in what's known as Web 2.0. Big Web sites such as Facebook and Digg, and even lesser known sites such as 37signals, are ushering in a new wave of Web-based applications that are being adopted by millions. With the acquisitions of YouTube (by Google), MySpace (News Corp. (NWS Quote), Skype (eBay (EBAY Quote)), and Del.icio.us (Yahoo! (YHOO Quote)) as examples of nascent technologies that have made their original VC investors a mint, the future looks bright for the new wave of tech-driven companies.

Still, start-ups are a tricky business and can remain that way even down the road when they go public. Even so, you can see why the venture capital game is so popular. While it's certainly not an approach for everyone, looking at stocks the way that a venture capitalist approaches potential companies to fund can lead to some exciting gains in your personal portfolio.