Amid turmoil and news of $700B federal bailout, is the sky falling for venture capitalists and start-ups?
We’ve asked some prominent players in venture capital and start-ups about where the venture capital industry and start-ups are headed over the next year, given the economic turmoil. The $700 billion federal bailout plan still being negotiated by Congress and the Bush Administration may restore confidence, but it looks like uncertainty will last for months. Many people believe we’ll be in a prolonged recession. In the latest news, Goldman Sachs and Morgan Stanley, the last big independent investment banks on Wall Street, will transform themselves into bank holding companies subject to far greater regulation, the Federal Reserve said Sunday night — one more nail in the coffin of what was once a freewheeling culture on Wall Street. Both banks had also engaged in some private equity and venture capital investing. The situation is more volatile than the last time we did this, during the Bear Sterns financial crisis this spring. The world markets are hanging in the balance. Fred Wilson, blog
