Is super-sizing your funds a way to create venture runway to steer past or through the downturn and stay competitive in the global market? Many startups - like Mahalo, Ning and LinkedIn - pride themselves on raising enough funding to survive the nuclear winter of late 2008 and basically all of 2009. Facebook decided to add runway and incent its employees through a follow-on $100 million passive investment from DST, Russia’s Digital Sky Technologies group, who also put $180 million into Zynga in December.

Last Tuesday, Intel Capital and 24 VC firms set to put $3.5 billion over two years into US startups to bump up America’s competitive edge. Intel Capital is earmarking $200 million individually.

Via the NYT: in a program called the Invest in America Alliance, Cisco, Intel, Google and Microsoft, among other big tech employers, are hiring 10,500 US college tech grads to regain international ground lost. Per Intel’s Paul Otellini:

Unfortunately, long-term investments in education, research, digital technology and human capital have been steadily declining in the U.S. So, too, has the commitment to policies that made us such an entrepreneurial powerhouse for more than a century.

As many VCs raise more to create investment mines in nascent countries such as India and China, the market seems to be correcting in trending tides: first startups who squirreled away cash, Angel capital/investment groups who are finding High Wealth Individuals (HWIs) looking for early discounts, tech companies seeing their international talent and US competitive edges decreasing, and now VCs who see value in creating big funds.

Is venture capital finding it easier to recover than the general US economy? Well, within the context of the international community, China, India, Taiwan, Finland, Korea and the Netherlands are all coming on strong.

According to the World Intellectual Property Org, the East is coming on strong with a 30% increase in Chinese patents and an 11% decrease in the US.

Via Rebecca Fannin at HuffPo:

Another interesting thing these funds have in common - besides size - is an outlook on India and China. NEA now has teams in both India and China, and Norwest has staffed up an Indian office and may open in China, Promod Haque told Silicon Dragon. He pointed out that India has strengths in software development and outsourcing of business processes, while China kicks in with hardware as well as semiconductor production and logistics. Over the past year, Norwest has funded three companies in India: the National Stock Exchange of India, mobile value-added service OnMobile and Shriram City Union Finance Limited. Norwest also inked a deal in China: mobile software startup Borqs Inc.

Per the NYT, fewer than 10% of US college students graduate with engineering degrees, compared to 1/3 from India and China.

“Early indicators are that we are not the center of innovation anymore. It is shifting to the East,” per Robert Compton, a venture capitalist and entrepreneur quoted in the article.

On the other hand, Amar Bhidé, author of The Venturesome Economy and Harvard professor, argues that while the US lags, its commercial application of digital far exceeds that of other countries.

Foreign governments and their investment trade communities still point to the US as an innovator, and better “integrator,”  in the tech space.

Bhidé’s theory of “nondestructive creation” further argues that innovation creates new products and services (and jobs!) without displacing existing ones.

A touch on the protectionist side, but interesting to see a myriad of forces, including venture capital, trying to go-big while much of the economy is in survival mode.

The trend to super-size will inevitably result in more startup creation, international integration of seismic technologies with the US playing a leadership role in their societal position, and VCs able to tap into the next, new markets of the East more ably than other investors.