Banks Join The Venture Boom…What Could Go Wrong!?

The Coronado lifestyle has seeped into my bones. I have slept in a few days and missed the 6 am cutoff for my daily email.

Not today!

Onwards…

There was some big news in my industry – venture capital – at the end of the week…

Banks can once again invest in venture capital.

Driving the news: Many banks had been banned from balance sheet investing in venture capital funds due to the Volcker Rule, which was part of the Dodd-Frank financial reform package passed in 2010. That prohibition will now expire on Oct. 1, based on an announcement from a group of agencies that included the SEC and FDIC.

Looks like I may have to be nice to the banks for a bit!

If you thought there was a bubble in venture capital valuations right now…check back in three years.

I have been surprised at the resiliency of seed stage prices in the face of COVID-19. I have not seen a tick down over the last four months. While COVID has accelerated so many digital trends, I don’t think prices have accounted for the difficulties that lay ahead in hiring, marketing and sales.

With my industry about to get the floodgates open to bank balance sheet money, I doubt we see prices come down any time soon.

Next thing you know I will have to wear a tie to pitch meetings.