Fred Wilson has a great post on this subject. For me he strikes the right sort of balance between the need to remain positive, the need to be realistic and the need for pragmatism when running a startup. I recommend reading the whole post, but the best summary is below, and is originally from VentureBeat:
Successful venture exits are becoming scarce. Yesterday, the National Venture Capital Association reported the first quarter saw only five venture-backed initial public offerings worth $282.73 million, down dramatically from 31 IPOs worth $3.04 billion in the fourth quarter. Mergers and acquisitions are also on the decline, with just 56 in the first quarter compared to 83 in the fourth quarter.
At the same time, angel investors have become more cautious because of the economic volatility, according to the 2007 Angel Market Analysis released Tuesday by the Center for Venture Research at the University of New Hampshire. That’s significant because angels account for 39 percent of investments in seed-stage start-ups.
What’s more, the Silicon Valley Venture Capitalist Confidence Index, an index that tracks the confidence among venture investors, fell to its lowest level in the past four years in the fourth quarter of 2007. You can expect that this confidence fell further in the first quarter, with the collapse of Wall Street bank Bear Stearns earlier this month.