July 14, 2008
Mark Cannice, Associate Professor of Entrepreneurship at the University of San Francisco School of Business and Management, has been surveying venture capitalists' confidence in the future high-growth entrepreneurial environment. His most recent survey shows that confidence has declined to a new all time low.
"The situation is concerning enough to be characterized as a capital markets crisis for the start-up community," writes the National Venture Capital Association.
"We are headed for a major economic problem worldwide . . . This will impact revenue generation of portfolio companies, as well as exit strategies and funding sources," states Steve Carnevale of Point Cypress Ventures.
With the economy as bad as it currently is, and VC confidence at a new low, Cannice believes that entrepreneurs will have to struggle for funding.
Comments | 4 Total
July 14, 2008 at 11:55am by Brendan Collins
Sure, online and tech start-ups are hurting for venture capital money. Everything suffers in a lackadaisical economy. But is it really in "crisis" mode? Wouldn't we have heard some warning bells before this point? It seems like tech blogs are constantly trumpeting the glories of new tech or web 2.0 start-ups every week.
July 14, 2008 at 5:09pm by tr sr
Start ups should not be in the most expensive area on the earth. They need to perform and earn money. R&D is a secondary part of a stably business. The talent can be told to move anywhere when you operate a company successfully.
July 14, 2008 at 9:07pm by Carel Two-Eagle
Brendan Collins (above) is right.. Crisis, shmisis. Venture capitalists don't care about whatever the new / expanding company offers; they care only about the return they can expect to make on their dollars. On one hand, that's said to be what capitalism is 'all' about. On the other hand, there's the matter of an attitude like that stifling small business. Which is why we've always funded from within. In the long run, we're less frustrated. And it sure makes us frugal and creative with our finances.
July 25, 2008 at 3:48pm by John Kibler
Entrepreneurship doesn't go away when valuations are depressed and fundraising is more difficult. The strong survive (and prosper). And after the economy has recovered, venture capitalists bought good businesses on the cheap will look like heroes.