Scott Shane's number one prediction for the new year is this:
1. The amount of capital provided to small and start-up companies will continue to shrink
All of the sources of finance, from venture capitalists to business angels to banks to peer-to-peer lenders, are all reducing the amount of money that they are providing to entrepreneurs. Until the problems in the credit markets get resolved and the economy starts to grow again, it’s very unlikely that we will see a reversal of this trend. Getting money will be difficult for entrepreneurs in 2009.
Almost on cue, we find out that SBA-backed loans fell 57 percent (compared to a year earlier) in the first quarter of 2009, which ended December 31, 2008.
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