Venture Capital Association Expect Difficult 2009

According to the National Venture Capital Association (NVCA), over 90% of Venture Capital individuals and organizations expect to make cuts in their ventures for 2009. The total venture capital investment for the year is expected to reach around $30 billion dollars.

This could spell trouble for entrepreneurs around the United States that are looking to grow. Recessions offer unique opportunities as often goods and services can be purchased at lower costs - allowing start-ups to succeed. However, if investment is down as well, entrepreneurs can have trouble raising the capital enough to expand.

It is also expected that the amount of money brought in by venture capital firms will decrease next year, as investors move more of their money into safer areas of investment. 85% of those surveyed expect to have some sort of decline from institutional investors. This is likely to correspond with decreases in venture capital returns, as few of their current investments are likely to consider IPO, mergers or acquisitions during the financial drought.

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