Really what entrepreneur really gives a damn about venture capital? They are likely on business failure 9 out of 10 and only a small percentage of businesses are culturally a good fit for a potential borrower. The venture industry as we have seen in the last ten years was probably a child of the economic times (the Bubble Years) and hence a particular expectation of who would make the grade. I think it is due to be completely re-invented. Why the fancy moniker? Private capital has always existed; trendy organized private capital was packaged as “venture capital” and existed for a variety of reasons: a new stratified affluence with sophisticated knowledge of finance, good credit lines, liberal banking relationships, creative marketing…etc. It all adds up to the power of money that was not necessarily old money or bank money initially on the front end.
Right sizing is just another word for contraction and re-invention. It is my belief that all traditional forms of venture capitalism are likely antiquated in the face of the new economy – define it as you will. Those days are done. We are entering a realm where bricks and mortar money are becoming less relevant – where money will more likely be spent on an SEO plan and a great idea by two Java programmers.
