Businessweek has the 2008 Venture Capital Outlook. They go on to say “And the truth is, despite a few hot IPOs, VCs will continue to find it challenging to generate the kind of home-run returns they count on to turn a profit, which is typically at least 10 times their initial investment.” … VCs expect 2008 to be the year that they finally start to unload companies in their portfolios that have been absorbing cash for years. A survey of 170 VCs released by the National Venture Capital Assn. on Dec. 17 showed that 59% of venture investors expect the market for IPOs to strengthen in 2008. Nearly three-quarters expect merger-and-acquisition transaction values—already nearly double 2005 levels—to either increase or remain the same in 2007.
I have been watching the VC trends for years and it is clear new players are establishing new standards in technology investing. How this translates into returns is another question. The financial side will depend on the liquidity market but the big trend in my opinion will be International. How VCs can capture the new international resources may ultimately determine who is the biggest winner.