US. Your pension fund could be invested in tech
The economics of the tech industry is a chain with a bunch of confusing links. Startups get their money from venture capital firms, and we’ve talked about how that works and why it heavily influences who becomes key players in tech and what products end up in your hands. But how do venture capital firms get their money? Limited partners, or private corporations; state, county and city entities; and universities. Now, continue to follow me down the chain. Where do all these groups get their money from? Regular people.
Private corporations and government funds are big funders of venture. (We’ll get to universities in a minute.) They use pension plans to make investments. That means they’re taking the money you’ve dedicated to, say, your retirement plan and investing it because they know it will be a while before you’ll withdraw those earnings.
“And so it’s ordinary teachers, firefighters and policemen who provide money to the pension funds that then invest in venture capital and private equity firms,” explained Peter Escher, the director of PitchBook, a private investment research firm.
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