America’s venture capital market broke all its records last year in the amount of money pouring into venture capital.
VentureOne Corporation president and chief executive, Dave Witherow, says despite recent havoc in the public markets, venture capital remains dynamic.
Owned by Reuters, VentureOne is a US-based venture capital research firm, offering investors, services providers and entrepreneurs information on venture capital. VentureOne was sold to Reuters in 1998 for an undisclosed sum.
Witherow, in Sydney for the Resnik Conference’s Alternative Investment Investors Summit, says in 2000 alone, investors contributed a record-breaking $US69 billion to 249 funds, doubling from 1999 $US34.5 billion invested 202 funds.
“Over half of the dollars raised for venture capital funds are now in funds exceeding $US500 million, and the median fund size reached $US138 million in 2000, up marginally from $US135 million in 1999,” Witherow says.
He says in 2000 a staggering 18 funds hit or exceeded the billion-dollar mark, compared to only three in 1999. The total of $US68.76 billion invested in venture-backed companies was an 80 per cent increase over 1999.
“Although this percentage increase may not be as impressive as the 154 per cent seen between 1998 and 1999, the amount invested in 2000 still exceeded the total for the previous three years combined,” Witherow says.
As for international investments, Witherow says this is a chance to invest in quality companies at relatively low valuations. He also says international borders no longer limit investment opportunities.
According to a recent VentureOne report the number of established US-based venture capitalists interested in investing outside the United States increased 29 per cent between 1998 and 2000. The report surveyed US-based firms who had or were planning to open 40 offices in Europe and Asia.
