Not one venture-backed company went public in the second quarter. It's the first time that has happened since 1978, reports the New York Times. In the first half of 2008, venture-backed companies went through 120 mergers or acquisitions, down from 169 in the first half last year. There were 20 fewer mergers or sales in the second quarter than the first. When it comes to IPOs, VCs blame the government's excessive regulation in the form of Sarbanes-Oxley.

“Venture-backed companies that successfully enter the public markets represent a critical job creation engine for the United States economy, and that engine has completely shut down,” said Mark Heesen, president of the National Venture Capital Association.

We need to put regulators, legislators, presidential candidates, and the private sector on notice that this situation represents a serious problem that will have long reaching economic implications if not addressed. We view this quarter as the ‘the canary in the coal mine.’”

(Photo by Secret Tenerife)

Contact information for this author is not available.