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Audio – VC dealmaking seen frothy, alarming
The funding of venture capital deals is getting far too frothy, and starting to head towards dotcom-boom levels, warned a Silicon Valley-based venture capitalist. “I think the challenge is there is too much money out there,” said Promod Haque, general partner at Norwest Venture Partners. “You are starting to see, therefore, deals getting funded at a very alarming rate,” he told the Reuters Venture Capital Summit. He said that many deals were getting funded in the same category of business and prices were rising. Haque said that the result would be the demise of many U.S. venture funds, leaving just 20-30 with the returns needed to survive.