Venture funding in Connecticut stalled in 2011, falling 37 percent from a year earlier, even as deal making picked up across the rest of the country. Venture capitalists injected about $135 million in Connecticut companies during 2011, a 37 percent decline from the nearly $216.5 million invested in the year-ago period. That sum represents 55 deals, compared to 59 deals in 2010. Read more at Hartford Business Journal's analysis article, by Greg Bordonaro.
MoneyTree report 4th quarter 2012 press release:
Clean Technology and Internet Sectors Show Double-Digit Gains in 2011
Venture capitalists invested $28.4 billion in 3,673 dealsin 2011, an increase of 22 percent in dollars and a 4 percent rise in deals over the prior year,according to the MoneyTree Report by PricewaterhouseCoopers LLP and the National VentureCapital Association (NVCA), based on data from Thomson Reuters. The amount of venture dollars invested in 2011 represents the third highest annual investment total in the past ten years. Investments in the fourth quarter of 2011 totaled $6.6 billion in 844 deals, a 10 percent decreasein dollars and an 11 percent decrease in deals from the third quarter of 2011 when $7.3 billionwent into 953 deals.
Double-digit increases in investment dollars in 2011 were spread across a number of industries, including the Clean Technology and Internet-Specific sectors. Investment dollars also increased across every stage of development category, with the exception of a 48 percent decrease in SeedStage investments. First-time financings rose in 2011 compared to the prior year, however, fourth quarter investing did show a decline in both first-time dollars and deals when compared to Q3 2011.
"As previously projected, venture capital investing in 2011 exceeded 2010 levels and ranks in the top three years for VC investing in the past decade," noted Tracy T. Lefteroff, global managingpartner of the venture capital practice at PricewaterhouseCoopers. "We saw a resurgence in investments in Clean Technology and Internet-specific companies in 2011, as well as a bit of a jump in average funding in the Internet sector. However, while venture capitalists continue to show their interest in these areas, they are acting prudently and not chasing excessive valuations. Accordingly, despite the increase in investing, we're unlikely to see these sectors overheat like we saw in the 1999 to 2000 era."
"While venture capital investment grew in 2011, it is important to note that deal volume growth did not keep pace with dollar growth,” said Mark Heesen, president of NVCA. “In most industry sectors, round sizes increased significantly, driving the higher investment levels across most stages of investment. Reasons for this phenomenon differ depending on area of investment. For some, the higher rounds are driven by the challenging exit market which requires venture capitalists to fuel their existing portfolios longer and at greater investment levels than in the past. This is particularly acute in the life sciences and clean tech sectors. In other sectors such as Internet, software and media, the higher rounds speak to increasing valuations. Given the diversity of the venture investment landscape, we expect these notable distinctions to continue into 2012 as our industry sectors are impacted differently by the continued economic uncertaintyand ongoing opportunities in the market." ...