Venture Capital industry at risk: it’s getting serious

Posted on June 23, 2007
Filed Under Economic/Business news

Matt Marshall from VentureBeat has written a post that you should really read. In a nutshell that’s what he wrote:

“U.S. Congressman Sandy Levin (D-Michigan) has finally introduced the bill that venture capitalists were dreading: A higher tax on their profits.
If it passes, and there’s a possibility it may, it will change the tax treatment of carried interest, or profit that VCs and other investment professionals get from their investments. The change would tax that profit at a much higher rate — by treating it as ordinary income, rather than as capital gains, which draws a mere 15 percent tax rate“.

That’s very bad news for the VC industry, as high taxes will probably result in a decrease in interest in this kind of investments. Many startups that we write about are financed by VC. In the nearest future we are going to cooperate with a well known VC to support you guys develop projects and receive appropriate funding; time will tell.

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