Terry McGuire

Terry McGuire is co-founder and general partner at Polaris Ventures, a Boston firm with over $3 billion under management.

VC cred: McGuire is currently chairman of the National Venture Capital Association. His firm has investments in more than 90 companies, including Akamai, JibJab Media, and Ironwood Pharmaceuticals.

The next big thing: “I do think there’s some clear trends,” he says. “If you look at what problems need to be solved…it’s clearly around cleantech and energy. The whole biological revolution continues to offer opportunities in both therapeutics and prevention. The information technology side is bursting out in a good way,” both on the social-media side and enterprise software. “We have to enhance productivity again. Technologies that are going to make things more productive and less expensive are going to be key areas.”

Takeaways: The industry will shrink, but not as much as some of the doomsayers have predicted. “I don’t think it’s going to be as dramatic as people think. I think there is clearly pressure for the shrink but…these are 10-year partnerships. They don’t go away overnight.”

Solid venture capital firms with a history of success will continue to thrive, and so will the companies that are getting funded by VCs now.

“I think the current crop will do just fine,” he says of companies getting VC funding now. “These companies will remain laser focused on what they want to do.” After all, “only the strong even dare go into the market these days. Those that make it through this period will ultimately thrive and do well.”

Michael Greeley

Michael Greeley is general partner of Boston-based Flybridge Capital Partners, which has $560 million under management across three funds.

VC cred: Greeley is on the board of the National Venture Capital Association and chairs the New England Venture Capital Association. His company has invested in such firms as Blackwave, Magen BioSciences, and GamerDNA.

The next big thing: The convergence of IT and life sciences. “I think that would be hugely exciting,” he says. Smarter homes and smarter grids in the cleantech area. “The other theme is more intelligent networks, wired or unwired. It all comes back to the power of the Internet.”

Takeaways: Greeley sees a real bloodletting coming in the venture capital industry over the next couple of years. From some 800 firms now, “in two years, there’ll be effectively 500. They won’t be able to raise funds, obviously.” And the firms that are left will have fewer partners. “A lot of people will just attrit.”

But that attrition will lead to a smaller, smarter venture capital community that makes better investments than many that have been made in the past decade. “You’ll have fewer ‘me too’ companies,” he says.

He says VCs “don’t invest in enough transformational companies.” With more partners in the mix, “you tend to make incremental investments. You don’t make out-of-the-box investments.”

As the VC market shrinks,“firms are going to be smaller and they’re going to do things that are more transformational. I think the industry in three years from now will be a really fun and interesting thing to be a part of.”

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