Linear and nonlinear gain characterization of electrically pumped vertical external cavity surface emitting lasers (EP-VECSELs) is presented with spectrally resolved measurements of the gain and with gain saturation measurements of two EP-VECSEL samples with different field enhancement in the quantum-well gain layers. The spectral bandwidth, small-signal gain and saturation fluence of the devices are compared. Using the sample with the larger bandwidth, we have demonstrated the shortest pulses generated from a passively modelocked EP-VECSEL to date. With a low-saturation-fluence SESAM for passive modelocking we have achieved 9.5-ps pulses with 7.6 mW average output power at a repetition rate of 1.4 GHz. With a higher output coupler transmission the pulse duration was increased to 31 ps with an average output power of 13.6 mW. The pulses were chirped mainly due to the group delay dispersion (GDD) introduced by the intermediate DBR, which compensates the optical loss in the structure.