On January 5, Google launched the Nexus One — the company's new "superphone" — with a good deal of fanfare. At a press event, Google executives showed off the sleek device, based on the search firm's own Android operating system with integrated services such as Google Earth, an online map and satellite image tool. Google's software, combined with a speedy processor, represent a new category of phones "as powerful as your laptop computer of three to four years ago," said Andy Rubin, Google's vice president of engineering, in a statement. The phone also includes voice recognition technology for speaking text messages and emails, and touts a 3-D interface, among other features that had the tech world buzzing before the launch event.
Early-stage investing in 2009 mirrored the rocky overall economy with fewer deals, lower valuations of companies, and almost no exits. By October there had only been eight IPOs of venture-backed companies in the U.S. This was only a slight increase over 2008 in which there were six IPOs during the entire year.
The last time such a phenomenon with IPOs occurred, according to Wharton Prof. Raffi Amit, was 1975. "VCs don't see a light at the end of the tunnel, which means they can't go out and raise new money. They have to be very careful with what new investments they make because they don't see how they can get out of the investments they are in right now," he says.
Further, Amit notes there has been a sharp decline in fundraising. "Seed investments in particular, which traditionally have come from angels, have all but dried up," he says. "Angels lost a lot of capital in the last decline in the stock market and a lot of them have disappeared."