ALJA On Venture Capital Investment Market 2011 Q1

However, the first quarter of 2011 marks the first time in four years that the amount invested in the first quarter has shown an increase over the fourth quarter investment amount. End Quote

(1888PressRelease) May 19, 2011 - Venture capitalists invested $5.9 billion in 736 deals in the first quarter of 2011. Quarterly investment activity increased 5% in terms of dollars but fell 11% in number of deals compared to the fourth quarter of 2010 when $5.6 billion was invested in 827 deals.

The quarterly deal count represents the lowest number of deals in a single quarter since the third quarter of 2009. However, the first quarter of 2011 marks the first time in four years that the amount invested in the first quarter has shown an increase over the fourth quarter investment amount.

The Life Sciences sector (biotechnology and medical device industries combined) saw an increase in venture capital (VC) dollars invested during the first quarter, rising 16% but falling 9% in deal volume from the prior quarter to $1.4 billion going into 164 deals. Driven by several large rounds including the largest deal of the quarter, investments in the Clean Technology sector jumped 26% in terms of dollars and 11% in the number of deals from the fourth quarter of 2010.

The Software industry received the highest level of funding for all industries with $1.1 billion invested during the first quarter of 2011. This level of investment represents a 9% decrease in dollars compared to the $1.2 billion invested in the fourth quarter. The Software industry also had the most deals completed in Q1 with 187 rounds, although this represented a drop of 21% from the 237 rounds completed in the fourth quarter.

In terms of dollars invested, the Biotechnology sector was in third place, rising 6% from the prior quarter to $784 million in the first quarter of 2011. The number of deals dropped in the first quarter, falling 17% to 85 from 103 in the fourth quarter of 2010. This marks the fewest number of deals in a single quarter for the Biotechnology sector since the second quarter of 2003. Medical Devices and Equipment rebounded in Q1 with a 34% increase in dollars while the number of deals remained flat. This sector ranked fourth overall in the first quarter in terms of dollars invested with $602 million going into 79 deals.

The Clean Technology sector, saw a 26% increase in dollars over the fourth quarter to $1.0 billion. The number of deals completed in the first quarter increased 11% to 69 deals compared with 62 deals in the fourth quarter. The increase in Clean Technology investments was driven by several large rounds, including five of the top 10 deals. The quarter marks the fourth time in history that Clean Technology investing exceeded one billion dollars.

Internet-specific companies also received more than one billion dollars with $1.2 billion going into 171 deals in the first quarter, a 19% decrease in dollars and an 18% decrease in deals from the fourth quarter of 2010 when $1.5 billion went into 208 deals. Internet-Specific' is a discrete classification assigned to a company with a business model that is fundamentally dependent on the Internet, regardless of the company's primary industry category.

:About ALJA (Anderson, Lloyd, Jones & Associates):
Anderson, Lloyd, Jones & Associates (ALJA) is a venture capital and management consulting firm. We invest in and provide management consulting services (including investor relations services) to early stage emerging growth companies and to microcap and smallcap public companies. We aim to form a close partnership with a company, developing relationships with management, investors and shareholders. We inform the investment community about a company, provide a management consulting to grow the business, and often take an equity stake in companies we assist.

:Press Info:
Kyo Machida
ALJA International Relations Manager
kyo ( @ ) alja dot com

###

space

Other Related Press Releases

ALJA On Venture Capital Investment Market 2011 Q1 by Alja