Economic uncertainty hits the innovation economy
Even before the debt ceiling debate came down to the wire Venture Capitalists were already getting nervous.
The Silicon Valley Venture Capitalist Confidence IndexÂ® ...dropped significantly from the previous quarter's reading of 3.91 ending the upward momentum in confidence since its low point in Q4 2008.
The study's author Professor Mark Cannice is at the University of San Francisco;s School of Management. He says VCs are worried about the health of the broader economy and are nervous that there's already a bit of a bubble in Silicon Valley that is making many start-up investments too expensive.
And it turns out this case of the VC jitters is global.
In a companion study on confidence among venture capitalists in China, Cannice and his co-author Ling Ding, found confidence declining to near a six year low on concerns of bubble valuations, more difficult exits, and a slowing economy.
The willingness of VCs to bet millions of dollars on unproven ideas has a huge impact on our lives. These are the people who brought us Google, eBay, Amazon, Twitter, Intel and Facebook. Not to mention technologies like the defibulator. When they pull back, the future takes longer to arrive.
And the most depressing part of the survey is that it was conducted BEFORE Washington lost its mind.