Maybe they should start calling it Software Valley.

Venture capitalists, who provide much of the funding that keeps startups growing, poured twice as much money into software companies in the last quarter of 2011 than into any other sector.

Venture firms nationwide put $1.8 billion into software, spreading the wealth among 238 deals. That was more than double the number of deals in the second-largest sector, biotechnology.

The trend was even more pronounced in the Bay Area, where one-third of all venture money went into software.

The data was reflected in the latest MoneyTree report, prepared by the National Venture Capital Association and PricewaterhouseCoopers using data from Thomson Reuters.

“The big story was software as a service — very hot,” said Debby Farrington of StarVest Partners, speaking of the MoneyTree findings. Her New York-based venture firm focuses on so-called SaaS or cloud-based software, which companies can rent online rather than buy at steep prices.

The wider adoption of cloud software also is being driven by the fact that more workers are bringing their personal smartphones and tablet computers to work and want the freedom to access their files anywhere, she added.

Internet-specific companies also received a healthy dose of attention from venture capital firms in the quarter, the MoneyTree report found. With VCs eager to find the next Facebook,

Groupon or Twitter, the sector received $1.3 billion, shared across 239 deals.But the software and Internet sectors both saw funding drop in the fourth quarter compared to the third, perhaps driven by sub-par Wall Street debuts by Groupon and fellow social media stalwart Zynga.

In fact, biotech was the only one of the five sectors the MoneyTree report tracks that saw gains in both dollars and deals in the quarter.

But while Tracy Lefteroff, who heads the venture capital practice for PricewaterhouseCoopers, called biotechnology “a hot spot” in 2011, his enthusiasm was tempered by the fact that biotech funding — particularly for early stage companies — has been on the decline for several years. In part, that’s because companies in the sector face high regulatory hurdles and steep costs to reach significant size.

The same factors, Lefteroff notes, plague cleantech. Even though the green energy category took in more venture funding in 2011 than ever before — $4.3 billion — the number of deals in the fourth quarter declined 14 percent compared to the previous three months.