Yahoo Finance

Venture capital has 'been dead' for last 4 years, this VC claims

Venture capital (VC) has faced significant challenges recently, exacerbated by higher borrowing costs and cautious investors. Despite initial hopes that the market (^DJI, ^IXIC, ^GSPC) would improve with a more business-friendly Trump administration and interest rate cuts by the Federal Reserve, conditions remain difficult. Tusk Venture Partners founder Bradley Tusk joins Catalysts to note that the venture capital landscape has been “effectively dead for the last four years." "There's been no liquidity, both in terms of IPOs or M&A activity — and there was hope, especially in the fall, that that would change for two reasons," Tusk says. "One, the Fed was cutting interest rates, which makes alternative assets more attractive. And two, the idea was with Trump coming in, you would have more kind of pro-business regulation, more pro-business regulators, and that combination." Tusk also observes that while the Fed had previously cut interest rates, central bank officials are unlikely to do so further, and the chaotic state of governance adds to the uncertainty. Tusk expresses doubt that liquidity will return soon, saying, “I’d be shocked if that happened” in the near term. To watch more expert insights and analysis on the latest market action, check out more Catalysts here. This post was written by Josh Lynch