Venture Capital Investments Set Record

Venture capital investment activity maintained its record pace in the second quarter with technology companies driving the growth, according to a survey by Price Waterhouse. The company said the quarterly survey, which included responses from 500 venture capitalists, showed investments hit a record $3.18 billion in the quarter, topping $3 billion for the first time and eclipsing last year’s $2.8-billion level. Technology-based companies received $2.23 billion, or 70% of the venture capital funds. Internet companies drew more than $500 million for the first time, while software and communications companies pulled in $1.6 billion, more than half of the overall total. The number of U.S. companies receiving venture investments also reached a new high of 697, up 23% from 1996. Technology companies represented 71% of those receiving funds. Regionally, Silicon Valley was the strongest performer, drawing more than $1 billion of the funds, or more than triple the level of any other region. New England companies attracted $317 million and companies in the New York metropolitan area more than $300 million. For the first six months of the year, venture capital activity exceeded $5.5 billion, nearly $500 million ahead of last year’s record level.