Fading support by the financial system for firms, and especially new entrants, is a major concern in the current context, underscoring the primary importance of fixing the financial system. Growing aversion to risk combined with other factors (such as difficulties for investors to exit) is already drying up many sources of seed and venture capital. The total amount of venture capital investment in the United States started declining at the beginning of 2008, and the fall accelerated at the end of 2008 and beginning of 2009 (Figure 2). Total investment in the 1st quarter of 2009 was down 60% as.
