Sarah Palin is quoted as saying, "Thanks but no thanks on that bridge to nowhere." Howard Hartenbaum, who was an early investor in Skype in 2002 and who joined August Capital this fall, would agree - in the context of investments.

"Many people think the economic problem is all related to debt, and I tend to agree with that," he said. The big change going forward is that a lot of companies will be funded by equity and not debt, he said. "There's going to be very few cases where companies can raise bridge funds," he said. "The great majorty will be equity and the prices will be considerably lower than the entrepreneurs have been gettng for the past couple years."

Hartenbaum, who made the Forbes' Midas List of top venture capitalists, spoke on a panel at the AlwaysOn Venture Summit in Half Moon Bay this week. His panel included angel investors Ron Conway, Jeff Clavier and Aydin Senkut. Sam Angus, partner at Fenwick and West, was the moderator. In this video, Angus asked Hartenbaum whether it was a good time for smaller venture funds.

Hartenbaum's answer? Yes.

If bridge financing funds are harder to come by as Hartenbaum predicts, then the environment becomes much more favorable to venture capitalists and early-stage ventures. The reason being that angel investors won't want to do a debt round, and won't want to do the paper work that goes into an equity round.