Venture Capital (VC) is widely recognized as a crucial factor for startup growth, and several policies are often designed by governments to ensure a higher availability of this type of finance. However, there is a concern that in an economy without economic dynamism and the resulting prospects for growth, venture capital may not help promote the projected growth. Conversely, the weakness of venture capital may be a sensible response by investors and it could signal that something in the economy is not working properly. This work particularly investigates the causal and temporal relationship between Mergers and Acquisitions (M&A) and Venture Capital investments, arguing that a more active M&A market may act as a precursor, with a certain time lag, to increased Venture Capital activity, because investors react positively to better exit opportunities.