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Venture Capital's government bailout begins (The hits just keep on coming)
https://nextwave.partners/gdp-shock-venture-capitals-government-bailout-begins/As GDP contracts, venture capital abandons private markets for government funding, rebranding struggling startups as "strategic assets" to capture Trump's new sovereign wealth fund. A new innovation model emerges where political connections matter more than business fundamentals.
The Trump administration's trade war has created widespread economic disruption and the economic indicators for Q1 2025 read like a coroner's report. The Federal Reserve Bank of Atlanta's GDPNow model projects a -2.8% contraction, deteriorating from -1.5% mere days earlier. Consumer spending growth has flatlined at 0.0%, while private investment growth has cratered from 3.5% to a bare 0.1%. Combined with rising prices across all industries, we now face textbook stagflation.
For venture capital, an industry built on growth projections and cheap capital, this reality fundamentally changes the rules of the game. The difference this time? Where venture capital once doubled down on private markets after downturns, they're now making an unprecedented pivot to government funding.
snip
The migration to Washington represents venture capital's ultimate admission of market failure. Unable to generate returns that attract private investment, they now seek capital that can't walk away - money extracted through taxation rather than earned through performance.
The Trump administration's trade war has created widespread economic disruption and the economic indicators for Q1 2025 read like a coroner's report. The Federal Reserve Bank of Atlanta's GDPNow model projects a -2.8% contraction, deteriorating from -1.5% mere days earlier. Consumer spending growth has flatlined at 0.0%, while private investment growth has cratered from 3.5% to a bare 0.1%. Combined with rising prices across all industries, we now face textbook stagflation.
For venture capital, an industry built on growth projections and cheap capital, this reality fundamentally changes the rules of the game. The difference this time? Where venture capital once doubled down on private markets after downturns, they're now making an unprecedented pivot to government funding.
snip
The migration to Washington represents venture capital's ultimate admission of market failure. Unable to generate returns that attract private investment, they now seek capital that can't walk away - money extracted through taxation rather than earned through performance.
Welfare for the rich.
Your tax dollars at non-work.
The Duke Brothers, Mortimer and Randolph, thank you.
"You lose the bet. He didn't give the Nazi salute at the SOTU"
One dollar, please.