Commentary on NVCA Predictions

Many folks have touched on the NVCA 2005 Predictions, and I only want to add that I hope everyone's optimism is well founded. I won't dwell, but I think these quotes are of particular note:

"We see U.S. venture capitalists investing more overseas in 2005. This trend will grow as domestic investing gets harder and venture capital becomes more plentiful. But our experience over 36 years is that investing overseas is inevitably more difficult than investing at home. We think the more effective strategy for dealing with the growth of foreign markets is to invest in U.S. companies with innovations in materials, energy, consumer electronics, biotech, and medical devices that foreign markets will buy."
-- Bob Pavey, Morgenthaler Ventures, Cleveland, OH

"I expect to see a relative increase in the availability of venture capital in emerging markets over the next five years - spurred by multiple state fund of fund initiatives in these markets and an overhang of venture dollars in the top ten markets."
-- David Mann, Spring Mill Ventures, Bloomington, IN

"Virtually all of the returns in the industry over the past 40 years have come from the Information and Communications Technology (ITC) sector with capital spending in that sector growing at nearly 3x the rate of GDP growth. ITC capital spending now represents almost 40% of all capital spending and I expect it in the future it will it grow at or near the same level as the GDP. ITC is a mature industry! Venture capitalists must find new industrial segments which are growing at a significantly faster rate than the GDP. Is biotech the answer? Either that, or we VC’s will have to outperform the GDP through shear brilliance. If we don’t, returns for the industry will decline to match other investment options."
-- Bill Stensrud, Enterprise Partners Venture Capital, La Jolla, CA

I love the themes; growth in international investing, community oriented funds, and success through new industries... So it goes.