There is no doubt that the venture capital investing scenario has undergone a change over the years. However, it is neither a passé nor is it ailing - it has merely "taken on a new set of dynamics," as opined by Alan Patricof, managing director of Greycroft Partners, which is a venture capital company investing in digital media businesses.

From 1960s till about a decade back, "going public" was the ultimate "win" for any venture capital investment; as the achievement of that singular aim was like having reached the zenith in terms of a business. Still, the success of going public was merely in terms of a stimulating technical accomplishment or a fairly good amount of revenue.

The 1970s and 1980s saw countless small and medium-sized investment banking firms thriving on the "irrational exuberance" related to the going public concept, thereby intensifying the "hot issue" phenomenon attached to an initial public offering.

However, in the 1980s and 1990s, big investment firms began recognizing the market potential of young venture-backed companies, especially after the emergence of Internet on the scene. The late 1990s saw the smaller investment firms either began quitting or merging with a small number of survivors.

With the burst of the Internet bubble in early 2000, realism bounced back in the market, along with a return to rational metrics - like multiples of revenues and profits. Currently, a true venture capital firm should ideally regress to smaller-scale funds and limit individual investments in early-stage companies, so as to accommodate the practicality of the exit opportunity!