Thursday, October 27, 2011

Venture Capital Roars Back

Much ink has been spilled over the exceptionally poor performance of the stock market during the third quarter of 2011, but there's one area that turned in strong numbers over that period: venture capital. U.S. venture capital firms poured a total of $8.4 billion into 765 start-ups during the third quarter. The dollar figure represents an increase of 29 percent over the third quarter of 2010.

The biggest winner was the consumer information services category, which includes such things as online search firms and social media. Those businesses received more than a billion dollars from venture capital firms in the quarter, in a total of 103 different deals. That's more than double the dollar figure raised in the same quarter last year.

According to Dow Jones VentureSource, which compiled the numbers, venture-capital activity is now on a pace to return to pre-recession levels by the end of the year. That could be a big jump-start for this sluggish economy.

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