Venture investing is strong in fourth quarter


Venture capitalists showed renewed confidence by investing at a rapid pace in the fourth quarter, with money going to Internet startups the most since the second quarter of 2001 and software investing close to achieving the same mark.

Quarterly fundings of $8.37 billion were up 21% from 2012 and brought 2013’s annual investment total to $29.4 billion, the sixth year in row the industry invested more than it raised.

Deals in the fourth quarter came to 1,077 and for the year were 3,995, up 4% from 2012, according to the MoneyTree Report released Friday by the National Venture Capital Association and PricewaterhouseCoopers, based on data from Thomson Reuters (publisher of VCJ). The average deal size for the year rose to $7.35 million from $7.08 million a year earlier.

Overall, the year’s investment total was the fourth largest since 2001, and it came close to funding levels prior to the financial crisis of 2008 and 2009.

In the year, similar to the quarter, software and Internet investing were strong. Dollars going into software startups accounted for 37% of venture investments, which represented the highest percentage since the MoneyTree Report began monitoring investments in 1995. Internet-focused companies attracted $7.1 billion of financing, the highest level since 2001.

This story first appeared in Reuters Venture Capital Journal. Subscribers can read the entire original story with table here. To subscribe to VCJ, please email [email protected].

Photo illustration of computer keyboard from Shutterstock.


Find new deal opportunities, super-charge your fundraising efforts and track top managers with VCJ. Get your FREE trial! Or subscribe now!