Friday, January 2, 2009
Venture-Backed Liquidity Reaches 5 Year Low
U.S., venture-backed companies are seeing their lowest liquidity in five years, according to a report released today by Dow Jones VentureSource. Dow Jones found that there was only $24.1 billion in IPOs and M&A in 2008, making 2008 the worst year in terms of liquidity for the venture capital industry since 2003. Dow Jones said the totals were down 58% from the liquidity produced in 2007. In the fourth quarter, there was only $3.9 billion generated via merger and acquisitions, and no IPOs. Jessica Canning, Global Research Director for VentureSource, said in analyzing the numbers that "the liquidity markets have essentially been cut off for venture investors."