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Posts Tagged ‘Moneytree’

Here is some interresting pointer around Cleantech and Investments from Techpulse 360.

“U.S. venture firms are taking a more circumspect view of clean-tech investing. Less flash, more focus on profits.

That could lead to more start-ups trying to build businesses with less money.

According to a recent survey, substantial sums of money continue to flow into the industry. Ernst & Young reported Monday that $2.6 billion went into clean-tech start-ups last year, a noticeably more optimistic assessment than last month’s MoneyTree survey, which posted a figure of $1.9 billion. The higher sum suggests VCs were significantly more active last year than may have been thought.

The E&Y work also uncovered a second detail that didn’t show up in the MoneyTree study – which was conducted by PricewaterhouseCoopers, the National Venture Capital Association and Thomson Reuters.  While investment dollars fell 45 percent in the fourth quarter, the number of deals were up – 21 percent to 62. More deals, smaller sums of money per company, more room for profits.

The MoneyTree work found that the number of deals in the quarter fell to 47 and that overall dollars declined 58 percent.

It is hard to know which of the surveys is more accurate. But the prospect of venture capitalists funding more companies at lower dollar values is interesting to contemplate. It suggests funds are seeing clean-tech investing more like they see information-technology investing: put a little money in, expect a lot back.  This prospect may encourage more VCs to take part.”

Read the full article here.

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Here is a good VentureBeat article.

“Now that 2009 is over, we can add up the numbers on how much venture firms invested in startups during all of 2009 — and, well, it was a lot less than in the past. Over the course of the year, VCs invested a total of $17.7 billion in 2,795 deals, the lowest total since 1997, according to the MoneyTree Report from the National Venture Capital Association and PricewaterhouseCoopers.

On the bright side, the worst hit came from numbers that we’ve already reported on, since investments really plummeted during the first half of this year. Funding went up in the third quarter, and more-or-less held steady in the fourth. The amount invested went down from $5.1 billion in the third quarter to $5.0 billion in the fourth quarter, but the numbers of deals went up from 689 to 794. So VCs were making smaller bets, but they placed more fo them. Another reason for optimism: There were more seed and early-stage deals in Q4 than in any other quarter this year, so new ideas are still getting money.

Two of the industries we spend a lot of time covering at VentureBeat took a big funding hit in 2009. Internet-specific companies received $2.9 billion dollars, down 39 percent from 2008. Cleantech fell even further to $1.9 billion, a decline of 52 percent. Meanwhile, VCs put more money into biotech ($3.5 billion) than any other sector, and even then, biotech saw a 19 percent drop from 2008.

NVCA President Mark Heesen acknowledged the drop in a statement released with the report, saying, “The venture industry had no choice but to slow the investment pace in 2009.” But he also offered an optimistic view of the year to come.

“Now that the economy has begun to show signs of improvement, we expect to see dollars flow more freely back into those sectors that offered the most promise before the recession began — clean technology, life sciences and IT,” Heesen said. “The seed and early stage pipeline needs replenishing across all industries and the health of the startup community in the next decade will be dependent upon more robust first-time financings. 2010 should be the year to begin that process in earnest.”

Read the complete article here.

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To no ones surprise, the VC community pulled in its spending spree and held back in the wake of the financial crisis. The recent report release by NVCA (National Venture Capital Association) this last weekend. A funny detail in the mix is that they release the data on saturday afternoon, after all media stopped their coverage for the weekend!

“Venture capitalists invested just $3.0 billion in 549 deals in the first quarter of 2009, according to the MoneyTree™ Report from PricewaterhouseCoopers (PwC) and the National Venture Capital Association (NVCA), based on data provided by Thomson Reuters. Quarterly investment activity was down 47 percent in dollars and 37 percent in deals from the fourth quarter of 2008 when $5.7 billion was invested in 866 deals. The quarter, which saw double digit declines in every major industry sector, marks the lowest venture investment level since 1997”

Overall, its not good news. In specific areas, the analysis continues;

“The Software sector received the highest level of funding with $614 million going into 138 rounds, a drop of 42 percent in dollars and 34 percent in deals compared to the fourth quarter of 2008.”

“The Life Sciences sector (Biotechnology and Medical Devices combined) experienced a 40 percent decline in terms of dollars and a 31 percent drop in deals with $989 million going into 133 rounds. Investment in Biotechnology fell 46 percent to $577 million in the quarter, while Medical Device investments fell 27 percent to $412 million. Investments in Life Sciences companies represented 33 percent of all investment dollars and 24 percent of all deals in the first quarter, which is in line with historical norms.”

For the whole pressrelease, click here. For additional coverage on this story see; ABF Journal, The Batts report.

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