My worst fears haven't been confirmed. But they've not gone away, either.

Over the weekend, the quarterly Money Tree report said that venture capital investing equaled $7.1 billion in the first quarter, down 5% from last year's Q1, MarketWatch reports.

Surprised? Don't be. Private equity all-star Blackstone (NYSE: BX) fell in the red in 2007. And peer Fortress Investment Group (NYSE: FIG) has no moat.

Even so, there's a broader worry for Fools to contend with. Tight-fisted VCs foreshadowed a tech industry meltdown in 2001. Shares of tech bellwethers Cisco (Nasdaq: CSCO), Oracle (Nasdaq: ORCL), and Sun Microsystems (Nasdaq: JAVA) have yet to return to their 2000 highs. Now that VCs are cutting back their investments, it's time to ask: Will today's credit crunch equal the destruction wrought during the dot-bomb era?

Certainly, it has already proven to be worse than any of us thought. But we also have evidence that talk of a global slowdown in tech spending may border on the hysterical. Oracle, for instance, sold off on such fears after reporting big gains in its core database business.

But that's Oracle. Smaller tech companies may prove more vulnerable. Especially those that will need assistance from the capital markets to grow.

My advice? Watch the VCs closely. They're more conservative than you think. If they're funding fewer deals, it's because -- after factoring in valuations, competition, and the pace of innovation -- they don't see as many attractive opportunities as they did a year ago.

I think they're right. Confine your tech investing to stocks that dominate fast-growing, economically critical industries, Fool. History says that's where the big money is made.

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