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There were only six IPOs and far fewer M&A deals than in any quarter last year, according to Dow Jones VentureSource. This survey is essentially showing the same things as a rival survey published yesterday by the National Venture Capital Association and Thomson Financial.

The number of exits are dropping because of larger issues in the US economy, we discussed in this article yesterday. Public companies become more conservative about buying private companies. The private companies don’t want to IPO during a downturn, because their stock might not be valued at what it is actually worth, or because there’s lessened demand.

There were 80 M&A deals, according to Dow Jones, while its competitor’s survey shows 56 deals. This is more an issue of differing methodologies. Each group defines a venture-backed group differently. “Venture capital” may sometimes include exits that involve private equity firms.

The VC’s we’ve spoken with have been fairly positive considering the circumstances, as have our readers. A poll that I ran with the story, (which had an admittedly negative slant) showed that around two-thirds of respondents didn’t think things would get too bad, while only a third thought things were going to get “brutal.” One commenter, Dave McClure — a well-known angel investor who is optimistic about building third-party businesses on social networking platforms — even reprimanded us for not letting readers choose a third, more positive choice in the poll.

Fair enough. Even for relatively profitless companies, things may not be bad during a recession, as Fred Wilson points out:

If a company has lots of users and no real revenues, but keeps its burn rate low and can continue to ramp its user base cost effectively, I think the economic downturn isn’t necessarily bad news for them. After all, if you have no revenue, you have no revenue to lose when your customers stop placing orders. That last bit was sort of tongue in cheek. I don’t want to downplay the importance of revenue and business models. But in my mind, the single most important thing is not revenue in a time like this. The most important thing is cost structure.

Beyond investing in local companies, investors can also send more money abroad to fast-growing markets like China. And they seem to be doing that. Another recent report shows that venture investments totaled $585 million in that country this past quarter, up 12.9 percent from the previous year.

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