Thursday, November 4, 2004

Venture Capital Investments in Q3 Slow

A recent report shows that the U.S. venture capital market showed its usual slowing last quarter, despite another report this week that showed a healthy increase in fundraising by venture firms. The Ernst & Young and VentureOne Quarterly Venture Capital Report, released last week, showed that nationally $4.56B was invested in 467 deals. The deals and amounts invested were down from Q3 of last year. However, the report pointed out that seed and first roudn deals were up significantly, as venture capitalists have shifted away from existing portfolio companies and into new investments. For Southern California, the report showed $500M invested in Los Angeles, Orange County, and San Diego, with the bulk of that investment in San Diego's biopharmaceutical industry. Investments in LA and Orange County were spread across the board, mostly in the Information Technology area. Amounts raised in Southern California were actually up versus Q3 of last year.

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