I think VCs in general will be backing less companies in the next year or two. Part of this may be that limited partners who have pledged a certain amount of i

I think VCs in general will be backing less companies in the next year or two. Part of this may be that limited partners who have pledged a certain amount of investment capital will be trying to delay VC funding rounds until the economy stabilizes. Other has to do with the fact that there was a drastic reduction in IPO and M&A activity in 2008. In 2007, there were 86 venture-backed IPOs. In 2008, there were only 6, and 5 of those were in Q1 2008. On the M&A side, there were 360 venture-backed M&As in 2007. In 2008, there were 260. So in other words, VCs aren't getting their money back. Out of the less number of companies being backed, I guess by this article's argument, these "exponential growth" companies are more likely to be funded. But isn't that obvious? If you were going to invest your money, would you invest in a company that "grows slowly" or a company that "grows really fast"? I guess it's safe to say: don't try to start a venture-backed service company...