VC Juggernaut Says 'Easy Money' in Silicon Valley is Just About Gone

Is the tech bubble v. 2.0 about to burst? One prominent investor sent a warning signal that the best-of-times in Silicon Valley might be winding down.

Re/code noted a lengthy-essay written by Bill Gurley, who is a general partner at tech venture capital firm Benchmark.

The synopsis of the essay is that tech startups have raised too much money and venture capitalists/financiers have given them too much money. And both are in trouble.

One of the key points is that firms (startups) that have been able to raise easy money in the past without producing a solid product are finding that that well is drying up. Now, the firms are having to find additional money, but are doing so at lower valuations, which isn't a good thing for early investors.

Gurley sees venture capital firms now loading up on cash before some or most of their investments implode. But, the firms' traditional investors aren't putting in any more money, so VCs are looking just about everywhere for more cash.

Again, you can read the entire 5,700 word essay here.

Current investments and board seats for Gurley include: Brighter, GrubHub, Linden Lab/SecondLife, LiveOps, NextDoor, OpenTable (recently acquired by The Priceline Group (Nasdaq: PCLN)), Scale Computing, Uber, Ubiquiti Networks (Nasdaq: UBNT), and Zillow.com (Nasdaq: ZG).

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