While investment banks jockey to become the lead underwriter for the next hot new tech IPO and broker-dealers dip into the secondary market for Facebook stock, another Wall Street contingent has been barreling its way into the tech sector.
According to the Wall Street Journal, hedge funds with a hunger for tech stocks and seeking higher returns are increasingly investing in private start-ups. If you ask some venture capitalists, this is A NO GOOD VERY BAD THING.
Jeff Clavier, founder of SoftTech VC, a small, but influential Palo Alto firm told the Journal:
“Hedgies investing in start-ups directly is scary. They are the antichrist of patient, supportive early-stage investing.” Read More