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The Venture Capital Revival
There have been a number of narratives in circulation over the last year or so: the "we're in a tech bubble" (or "we're not in a tech bubble") narrative, the "venture capital is in decline" narrative (or "venture capital is broken"). So here's a new one to add to the mix: we're in a "venture capital revival."
That's the argument being made by Clearstone Venture Partner's Managing Director William Quigley. His 50-page report, released today, chronicles the changes to venture capital over the past decade and ends, not with an assessment about the end of VC but rather the possibilities for a stronger future.
The report identifies several factors that make conditions better today than for investors than they have been in over a deade. There are fewer VCs, for one thing, and a new era for technology startups has emerged. But this isn't a repeat of the dot com bubble, Quigley's report insists. Today's tech now has a global reach and attractive economics.
This piece is key, according to Quigley's analysis, as there are several factors that have radically changed the investment landscape: Internet companies reach critical mass faster, for example, and capital markets are better informed.
Quigley's report contends that this VC revival will require venture capital to change. He predicts a shorter investment cycle, for one, and an increasingly active secondary position market, for example.
Whether or not you find the argument that we're on the cusp of a VC revival convincing, his contention that money will flow where people spend their time sounds like good news for Internet startups.
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