Venture Capital: Is it on a Diet Pill?

Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “ Venture Capital: Is it on a Diet Pill?”

Venture Capital Outlook for the upcoming years is as obscure as ever due to many external factors such as the government intervention in the private sector to the state of the economy which is very fragile across various industries and sectors. Capitalism is no longer being conceived in a positive manner and no longer are those values being embraced. It is simple, the working model is broke. We need fresh ideas and blood to re-invent the New American Standards across all different platforms.

The Institutional investors are gearing up and getting more conservative and the total commitments to alternative assets is shrinking rapidly and the industry is shrinking just as fast as it was growing. More and more Venture Capital Firms are seeking alternative means of keeping their activity up to par and many are going back to the basics, repositioning their approach of not only controlling their investment in companies in the backend, financially but also in the frontend of business development and forming strategies that will fetch revenues for the next 3-5 years before a solid exit strategy is formulated by the self correcting marketplace. Personally, I would conservatively estimate that a good 30-50% of the Venture Capital Firms will throw in the towel and walk away from the industry. Same activity was seen during the times when a number of mortgage companies decided to leave the Subprime and Prime Mortgage Arena. The smarter ones recouped their investment, made money and moved on. Where are they now? We are seeing the same activity in the financial sector, banking mainly.That being said, this could very well be a healthy transformation for many companies that are positioned well with strong strategies and people to back them up. My thoughts: embrace good strategies, cut down costs and first restructure your organization and form strong ethical relationships with competitors by joining forces to that you can stand strong in front of bigger players with just as many resources, combined.

Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com