The salvation for small businesses appears to be the community banks that represent just 10% of all U.S. banks. These bankers live in the community. These are the old-fashioned relationship bankers that want to know about the character of the person they lend to.
Venture capitalists are often viewed as the heroes of the entrepreneurial Wild West. Without their willingness to gamble on the future success of unproven companies and products, the world would surely be a much poorer and less innovative place. Right?
The banking industry mentality is deeply conservative -- not the kind that makes sure that loans are collateralized and deposits protected. Rather, it is a mentality produced by an out-of-date understanding of the world.