Economy Has Venture-Capital Scene Looking in Mirror

Return on investments sags with stock uncertainty, credit woes—but money still there
By Kevin Spak,  Newser Staff
Posted May 12, 2008 11:56 AM CDT
The recession has led to fewer IPOs, and smaller mergers.   (Shutterstock)
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(Newser) – Economic troubles that have meant fewer IPOs and less-lucrative mergers have the venture-capital industry in upheaval, the San Jose Mercury News reports after last week's Silicon Valley gathering of VC players. Many believe the moneyed backers must treat entrepreneurs better for prospects to remain lively. Yet, though returns have turned negative, the firms are still attracting investors. 

“I think the headline for the audience is that the money is not going away,” said a speaker at one panel. To which another replied, “It will eventually if the returns aren't good enough.”