Silicon Valley venture capitalist index falls
A report monitoring the outlook of Silicon Valley venture capital investors reveals venture capitalists are less confident about the future
The Silicon Valley Venture Capitalist Confidence Index for the second quarter of 2012, based on a June 2012 survey of 30 San Francisco Bay Area venture capitalists, registered 3.47 on a 5 point scale, 5 indicating high confidence and 1 indicating low confidence.
This quarter's index fell back from the previous quarter's sharp rise in confidence and reading of 3.79.
The Silicon Valley Venture Capitalist Confidence Index is authored by University of San Francisco School of Management professor, Mark Cannice, and provides trend data and analysis on the confidence of Silicon Valley VCs in the future high-growth entrepreneurial environment.
The report cited troublesome macro conditions, an uncertain exit environment, high valuations, and regulatory burdens as impacting confidence of VCs.
As Cannice points out, one of the study's respondents, Elton Sherwin of Ridgewood Capital, US, asserted that as US start-ups conduct more business internationally, the economic slowdown in Europe and China will have a much bigger impact than ever before.
"Despite the macroeconomic and regulatory constraints that ruled the day in Q2, the projection of a more welcoming exit market, and continued focus on technological, market, and business model innovation points to a brighter outcome for the balance of 2012," concludes Cannice.
In related research on China Venture Capitalist confidence, Cannice discovered confidence among VCs in China plummeted to a historic low in Q2, due in part to macro economic uncertainty and continued high valuations.
