More on Disintermediation of Venture Capital

MIT's Technology Reviewe weighed in on Web 2.0 companies disdaining venture capital. They note that "through trial and error ... it's possible to build and launch a Web-based product for a fraction of what it would have cost only a few years ago. Open-source software, virtual work environments (i.e., no rent or overhead), and cheap and plentiful server capacity have helped keep down costs." They think this to will pass. ... As a result, many Web 2.0 entrepreneurs have been able to roll out compelling services without becoming involved in the culture of venture funding." They think this too will pass, once Web 2.0 companies begin to find sustainable business models. Getting launched should not be confused with having a business. Then again, they did not deal with the threat to VCs from Google and Yahoo.