News - U.S. Venture Capital Spending Down 5%, on Pace for $21 Bln Year

U.S. Venture Capital Spending Down 5%, on Pace for $21 Bln Year

"U.S. venture capital spending fell almost 5 percent in the second quarter and first half, suggesting an annual investment rate of about $21 billion for a second year, a survey said.

Venture capitalists invested $5.77 billion in companies in the three months ended June 30, down 4.8 percent from $6.07 billion a year earlier. That brought the first half to $10.64 billion, down 4.7 percent from $11.17 billion, according to a survey by PricewaterhouseCoopers, Thomson Venture Economics and the National Venture Capital Association in Arlington, Virginia.

Venture capital spending has hovered between $4 billion and about $6 billion a quarter for 13 quarters, the survey said. Pension funds continue to put money in venture capital funds in hopes of higher returns than from stocks and bonds. Competition among venture firms to invest in companies with established revenue is driving up prices, investors said."

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