Don't Worry About Venture Capital History

from the follow-the-trends dept

An interesting column by Bob Pavey, a partner at Morgenthaler Ventures for over 30 years talking about historical venture capital crashes over his many years as a VC and what it means for this current crash. Basically, he says that history overall isn't much of a guide, but there's always an opposite reaction to any extreme investing period. However, the limited partners (mostly institutional investors) aren't running away. They're simply annoyed and are using the opportunity to slap the wrists of VCs they felt took advantage of them in the late 90s. However, they know they need VCs and are still interested in placing their money in VC funds. In fact, many (as has been pointed out over and over again) realize that now is a great time for VCs to make investments with low valuations - and thus are putting more money into funds (even as they force some VCs to cough up some of the remaining cash in old funds).

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