Monday, April 20, 2009

Venture Capital Investments Down in 1st Quarter of 2009

This week, I handled three separate requests for SBDC clients to locate venture capital firms who might be interested in their business concepts. This might be just a coincidence, or a reflection on difficulties each had in pursuing "conventional" lending avenues.

Regardless of why it happened, it was a disconcerting coincidence to also read this week a press release from the National Venture Capital Association (whose website provides links to data cited in the release). It's a five-page document, but the gist of the message is grimly summed up in its title:

"Venture Capital Investment Plummets in Q1 2009 to 12 Year Low"

The decline was consistent across all the industries measured in the report, as well as across every business development stage.

The comments of Mark Heesen, president of the NVCA, are meant to provide reassurance:
"While this drop in investment is significant, we are not forecasting levels to continue to fall further. We would expect a mild and steady increase in investment throughout the rest of the year, particularly if the exit pipeline is allowed to clear."

Stay tuned . . .

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