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Low interest rates -> search for yield by institutions -> increase of flow of funds into riskier assets (PE / VC / junk bonds / developing nation sovereign debt
by hkmurakami 11y ago
Low interest rates -> search for yield by institutions -> increase of flow of funds into riskier assets (PE / VC / junk bonds / developing nation sovereign debt) -> "cheap money" for later stage funding.
This contrasts sharply with 1980's VC where capital was much more scarce and thus VCs were able to command more equity for less money put at stake.