Entrepreneurs Feel Squeeze as Venture Capital Gets Scarce

Last Updated Nov 6, 2008 4:03 PM EST

wsjA slow and down economy affects many areas of the business world, but one in particular are small businesses and entrepreneurs. Especially those who rely on venture capital groups for funding. These groups are critical to the early development and growth of many companies, in particular those in the technology and life science industries. Wall Street Journal's Pui-Wing Tam lays it out in his article "Entrepreneurs Feel Squeeze as Venture Capital Gets Scarce." Pui-Wing writes:

"Entrepreneurs are seeing lots of their traditional avenues of finance getting whittled away," says Mark Heesen, president of the National Venture Capital Association. He adds that he has a "high level of concern" for the overall health of the venture industry. The pullback comes as venture capitalists have been hurt by a gyrating stock market, which has put a crimp in the market for initial public offerings, which the industry depends on to generate returns. Merger-and-acquisition activity -- another route to returns -- has also tanked. And many venture capitalists are also facing difficulty raising funds as their investors grapple with hard-hit portfolios.