back to article US venture capitalist spending continues to slide, hits six year low in Q3

Hopes that the venture capital market would recover in the latter half of 2023 can be considered well and truly dashed, with a report finding VC spending in Q3 reached its lowest level in six years. The data comes from PitchBook and the National Venture Capital Association's Q3 Venture Monitor report, released today, which …

  1. DS999 Silver badge

    To be expected

    The Fed is shrinking the money supply, and interest rates are going up. When they could easily borrow money at almost zero interest it was a lot easier funding speculative startups. Even if you know 90% will fail, if one is a winner with a 20x return you still double your money. Now the interest costs eat into that significantly, and they have to be more picky about who they fund.

    1. Charlie Clark Silver badge
      Thumb Up

      Re: To be expected

      "almost zero interest" decribes what's called fiscal repression where savers are effectively penalised for not spending, while creditors see their liabilities decline and are encouraged to borrow (effectively seize) more.

      The VC is much vaunted in the press but the numbers don't look so good over time. We've just had 14 years of unusally good conditions for it which has justified all the growth at all costs strategies.

      1. DS999 Silver badge

        Re: To be expected

        Yes that's why asset prices like houses have gone way up over the past 20 years of low rates - they've increased many times more than the amount of inflation or the amount of economic growth during that period could possibly justify.

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