Mass High Tech, The Journal of New England Technology, reports in today’s edition that the region’s venture capitalists expect the market for initial public offerings of technology company stock to be frozen until at least 2011 because of the ongoing global economic crisis and instability in the stock market.
BOSTON--(BUSINESS WIRE)--Mass High Tech, The Journal of New England Technology, reports in today’s edition that the region’s venture capitalists expect the market for initial public offerings of technology company stock to be frozen until at least 2011 because of the ongoing global economic crisis and instability in the stock market. IPOs represent one of the best opportunities for investors and founders to benefit from the growth of technology companies, and provide incentive for entrepreneurs to launch new companies.
Mass High Tech has also reported that companies that had filed plans with federal regulators for IPOs have begun to cancel those plans. Through in-depth interviews with more than a dozen key New England venture capitalists, Mass High Tech journalists reported that investors should expect almost no IPOs in 2009 and 2010. In addition, the VCs predicted that a second popular path for growing companies — acquisition by a larger company &ndash will be dramatically limited by the low prices that potential partners are willing to pay in the current economy.
Venture capitalists who have invested with companies in technology areas such as computers, software, the Internet, alternative energy and biotech said that the lack of IPOs and acquisitions—combined with difficulty in raising new funds --means that they will have to carefully examine their investment portfolios, more carefully managing expenses at some companies and perhaps shutting down those that are less able to survive the tough economy.
The predictions by venture capitalists are included in Mass High Tech’s annual review of technology trends for the past year and for 2009, which can be found online at www.masshightech.com.
