Dow Jones Shows Slight Decline in Venture Deals, Dollars, Since Last Year

More or less correlating the results of two previous venture capital surveys, Dow Jones VentureSource says today that venture investors throughout the United States put $8 billion into 776 deals during the second quarter that ended June 30.

In terms of absolute numbers, that’s fairly close to venture data we reported Wednesday from the MoneyTree Report, which counted $7.5 billion in 966 deals nationwide over the same period. A quarterly venture survey by New York-based CB Insights found that U.S. VCs put $7.6 billion in 768 startups during the second quarter, which we reported last week.

Comparing the three surveys is trickier, because each one uses different sources and slices and dices its venture data differently. So each quarterly survey is really only consistent with its own data. In this respect, the trend of second-quarter data in the MoneyTree Report is flat to slightly up from the same quarter in 2010, while the trend in CB Insights’ second-quarter data was up sharply year-over-year.

The venture trend highlighted by the Dow Jones data is flat to slightly down. The $8 billion that VCs invested nationwide was down about 5 percent from the $8.4 billion during the second quarter of 2010. Dow Jones counted 776 deals—down 2 percent from the 788 deals VCs did in the same quarter last year.

Venture investments in seed- and first-stage rounds accounted for 19 percent of the capital and 37 percent of the deals during the quarter, according to Dow Jones VentureSource. The median amount raised for a round of venture financing during the second quarter was $5.2 million, up from the $4.6 million median a year earlier.

A couple of other highlights from Dow Jones’ second-quarter survey:

—Venture capital firms invested $2.3 billion in 184 startups that Dow Jones classifies as healthcare, which includes healthcare services, biopharmaceuticals, medical devices, and medical software and IT. That was an 18 percent decline in capital and 12 percent slide in deals from the $2.8 billion that went into 209 deals in the second quarter of 2010. Running contrary to the downturn were VC deals in medical software and IT, where $198 million invested in 19 deals represented a 27 percent rise in capital invested and a 58 percent jump in deal count from the $155.8 million and 12 deals in the year-ago quarter.

—Information Technology (IT) companies raised $2.3 billion for 255 deals, a 9 percent increase in capital and a 5 percent increase in deals over the same quarter last year, when VCs put $2.1 billion in 242 startups. While there was a surge in software activity, deals in communications and networking, electronics and hardware, and semiconductors were all down.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.