Standard economic theory states that during financial crises, investors exhibit a "flight from risk" behaviour; certainly, one can imagine institutional investors pulling their money out of hedge and venture capital funds. However, this crisis also has the US Federal Reserve aggressively cutting interest rates, with the effect that capital becomes cheaper, given a fixed risk premium.
My guess is that venture capital will become harder to find, while companies which are profitable but need capital in order to grow (e.g., to buy more servers) will find that loans are cheaper. Seed funding probably won't be affected at all -- money for that generally comes from people who believe in what they're doing (and are seeking, in part, a non-financial payoff) rather than people or organizations which are trying to maximize their profits.
Loans cheaper? I think you're dreaming. The problem with your "standard economic theory" is that it fails to account for how much smaller a part of the world's economy the US is. The way to leave risk behind is to leave the US and invest elsewhere. I think we will see that happen at a greater scale now.
right, because EU startups are doing very well now... cheaper credit/more foreign investment doesn't change the fundamental dynamics at play when starting a company, like how rigid the laws are, or how cheaply one can build a startup.
My guess is that venture capital will become harder to find, while companies which are profitable but need capital in order to grow (e.g., to buy more servers) will find that loans are cheaper. Seed funding probably won't be affected at all -- money for that generally comes from people who believe in what they're doing (and are seeking, in part, a non-financial payoff) rather than people or organizations which are trying to maximize their profits.