Reality Time For Dot Coms And The Fed

Incubators are not for babies; VCs are not Viet Cong; and angels don't sport wings--at least not in today's world of Internet finance. Instead, these groups make up a new financing phenomenon that, in the past three years, has pumped billions of dollars into spanking-new Net startups. The sharp April downturn in the prices of high-tech stocks, sparked in part by higher interest rates, is now causing these financiers to pull back sharply. Many startups are gasping for lack of funds. To those who are worried about speculative "froth" in the markets, this is all to the good.

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