DISQUS

VentureBeat: Obama administration to tighten regulation on VCs?

  • Dean Petorsi · 9 months ago
    Thank God. It's about time.

    There have been some comments floating around for the past few months from people "in the know" about these changes.
    I can't wait to see legislation passed where every Partner at a VC and Hedge firm will be required to pass the Series 7, 63, 65, 24, 27 & 31.
    Considering these "privileged and over paid" firms are investing pension money and the VC industry has horrific returns over the last 10 years this is a great start.

    Change is coming!!!!
  • Anthony Ha · 8 months ago
    VCs are investing pension money?
  • Dean Petorsi · 8 months ago
    Yes, they are.

    Look at CalPers (state employees), CalSTRS (Teachers) among others?

    ...In 1978, the US Labor Department relaxed certain of the ERISA restrictions, under the "prudent man rule,thus allowing corporate pension funds to invest in the asset class and providing a major source of capital available to venture capitalists....
    http://en.wikipedia.org/wiki/Venture_capital


    http://www.boston.com/business/markets/articles...
  • Anthony Ha · 8 months ago
    Ah, OK, thanks for pointing that out.
  • AndreaF · 9 months ago
    Insane to provide confidential information and for VCs to be included as well.
    First, the information will never stay confidential and therefore the risk of market distrotion and maniputation is hige.
    Second, VCs, PEs and HFs are not the cause of this mess, Banks are. Banks offer a public service and the current regulation in place should be enforced better; imposing more regulations on the funds will make things worse.
  • Barbara Duck · 9 months ago
    I'm sure there's open are for compromise here too, but we don't want the makings of another Ponzi scheme either, so registration may not be a bad idea. As far as the taxes, that's an issue of it's own and should be up for discussion from both ends.

    I see some of this as an effort to also try to bring government and private industry together on the same note if you will. I don't see a need for VCs to have to report every detail as well, but a general plan of business would be in line, after all the rise of the VCs in health care in particular arose due to lack of government funding and support and we would not have some of the drugs, devices, etc. available to us today if VC funding had not answered the call.
  • Anthony Ha · 8 months ago
    Yes, I definitely agree that this is a "devil is in the details" situation.
  • AndreaF · 8 months ago
    Madoff'sPonzi happened because of lack of control, not becasue of lack of regulations.
    And the people who lost their money were aware of the risks; just decided to ignore them.
    VCs and PEs are different from HFs anyway nad certainly should not be bundled together.
  • Anthony Ha · 8 months ago
    My impression is that these regulations aren't just a response to Madoff, but to the broader financial meltdown. Agree on the second point, though I'm not particularly informed when it comes to hedge funds.
  • chad · 8 months ago
    If I was a USA VC, I would take my fund, my LPs and be moving on to a new jurisdiction, pronto. Why deal with additional cost and regulation when there are plenty of jurisdictions that will be more than happy to be supportive, and with less taxes, more freedom and less hassle.
  • Anthony Ha · 8 months ago
    Unless, of course, you still believe that most of the innovative startups are in Silicon Valley. I suppose that's debatable -- but me, I'd stay put.
  • motionview · 8 months ago
    Good, they played a significant role in putting these Bozos in office.
  • Tom Black · 8 months ago
    Hopefully all these VCs will think again the next time a Democratic presidential candidate comes sweeping through the valley collecting donations and support.
  • PJ · 8 months ago
    Hopefully all these green happy Valley VC's speak up and stop this march to declare ware on innovation, wealth, and what has made this economy vibrant for decades.
  • William Carleton · 6 months ago
    Rather than attempt to persuade the Treasury and legislators that the venture capital industry as a whole is not significant enough to present "systemic risk" to the financial system, wouldn't it promote transparency for the NVCA to accept registration of venture capitalists as investment advisers, and shift the lobbying focus to persuading the government that harm could come to their portfolio companies from extending reporting too deeply into company-specific details? I have blogged and have a small debate going on this subject on my blog, www.wac6.com.