It's like the more they advance, the harder they fall. Many investors, dazzled by the seeming invincibility of the stock market, don't remember past corrections, said Sacramento portfolio manager David DeCamilla. A fair share of our tax revenues is coming out of the market, both in capital gains and stock options. The market's hammering over the past few weeks has sparked a re-evaluation of the very foundation of technology wealth. Internet start-ups are busy retooling their business plans to make sure profits are very much a part of the picture.
Venture capitalists are suddenly far choosier about where they put their money.
The low stock price will preclude them from raising additional funds in the market, he said. The market rout also hurts companies that haven't gone public yet, he said. What promised to be a busy April for stock offerings suddenly isn't. At least 25 companies reportedly have canceled offerings in the past month and many others are pushing back their IPOs until the market looks less hostile. A drop in IPOs could slow Silicon Valley's venture capital industry.