is a recipe for disaster,” Nashat said. “Venture capital over the last 10 years has not been a great asset class. We have not outperformed other asset classes, as we have in the past.”
Westerlind agreed, suggesting that venture-backed companies may have to get creative in finding ways to raise capital—such as selling commercial rights to their products in certain parts of the world. “Companies are having to rethink how to get the money they need,” Westerlind said.
Doll identified a series of recommendations the NVCA is formulating, although several seemed like a recycled sampling of the industry’s talking points over the last decade.
—Promote investment vehicles that provide a late-stage alternative to IPOs by matching a company’s VC investors with buyers (which Doll described as “the Fidelities of the world”) in private stock placements “to get the VCs liquidity.”
—Change tax policies to encourage company formation.
—Streamline or eliminate counterproductive regulations. A PowerPoint image Doll displayed during his presentation identified “Sarbanes-Oxley reform” as a target, as well as “stock option expensing.”
—Increased government support for basic research and development. The VC industry still wants to reform restrictions on Small Business Innovation Research grants to give venture-backed startups access to SBIR funds.
—Change nature of investment banks, whilerestoring comprehensive equity research.
—Preserve internationally competitive capital gains treatment.
—Long-term cleantech policy.
—Healthcare reform.
—Human resources, described only as “immigration.” Doll did not discuss the NVCA’s recommendations on the issue, but the NVCA most likely wants to increase the number of skilled foreign immigrants allowed to work in the United States. The NVCA might want to rethink pushing again for this one if they want to avoid a public-relations backlash. Yesterday, the U.S. Labor Department reported the number of American workers receiving unemployment payments jumped to 4.78 million last week. That’s the most since the government began keeping records in 1967.
