Venture capital backed IPOs hit a 30-year low last year, with just 6 venture-backed companies making a public debut, says Paul Holland and Steve Vassallo, partners at the Menlo, CA venture capital firm Foundation Capital.
This isn’t just bad news for the venture capital industry. It’s bad news for the U.S. economy as a whole, say Holland and Vassallo, in a guest article they authored for Venture Capital Dispatch, the Wall Street Journal’s inside look at high-tech start-ups and investors.
That’s because while venture capital represents only 0.02 percent of U.S. GDP investment, it generates an astounding 10 percent of all U.S. jobs and 18 percent of U.S. revenue, according to data from the National Venture Capital Association.
The answer? America needs to focus on a “Second Industrial Revolution.” It’s time to replace our sadly outdated housing, construction and utility infrastructure with a newer, more energy-efficient “green” infrastructure.
Holland and Vassallo point out that the processes for producing cement, windows for homes and distributing electricity haven’t changed all that much from the early 1900s, and remain energy inefficient or contribute to greenhouse gases. By applying American ingenuity to newer, greener approaches to infrastructure and construction materials, we can kick start the economy and create thousands of new jobs.
Their own firm has raised $750 million to invest in clean technology companies. Now they predict many new green infrastructure companies will be going public in the next three years.
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