Future of Venture-Capital Finance
Venture-capital finance has contracted sharply. Looking at the numbers shows an ugly picture for VCs and start-ups looking to raise money in the near future. Last year venture-capital funds raised just $15 billion, half the average of the preceding four years.
But it is not all bad news. Amount of money raised in 2009 by VCs have reduced by 55% compare to 2007. But at the same time number of funds raised money reduced from 250 to 120! It shows we are ending up with fewer VCs but more solid and real producers. The funds could not raised money and probably will shut down their operations have already showed that their existence do not bring any value into the start-up world. Their previous investments were all not successful because these guys were not VCs at the first place. Being a VC is not just about raising money; it is about building an operation and a successful company with entrepreneurs.