Why VC Investors and Startups Should Be Worried About the Bond Market

Rising interest rates keep investors away from risky assets, and recent volatility could stoke those fears

Last week’s surge in interest rates, sparked by President Donald Trump’s tariff moves, might end a recent uptick in venture capital investing.

Global VC deal value hit $126.3 billion in the first quarter, its highest level in nearly three years, according to data provider PitchBook. The rebound came as the Federal Reserve started cutting interest rates last year, putting the VC market on more stable ground. High interest rates tend to choke off VC investing, while lower rates can have the opposite effect.