A Defining Moment For Venture Capital
If you encounter an official from the National Venture Capital Association, be careful asking the innocent question, “How’s it going?” Don’t expect the official to answer, “Oh you know, same-old, same-old.” Instead, you’ll likely get an earful.
Mark Heesen, president of the venture-capital trade group, and Emily Mendell, vice president of strategic affairs, weren’t shy about answering that question last week on the sidelines of the Dow Jones Private Equity Analyst Conference. While they appeared comfortable lounging in oversized chairs above the lobby of New York’s Waldorf-Astoria, they are anything but relaxed when thinking about what lies ahead.
Never before has the NVCA faced so many defining moments at once. Venture firms have now gone a full decade without collectively returning a dime, causing their investors like pension funds and university endowments to question whether the venture capital model even works. As a result, a staggering number of poor-performing venture firms are expected to go out of business in the next few years.
