VC Investments Continue Slump

April 30, 2001 (PLANSPONSOR.com) - Venture capital seems likely to continue its funding slump this year, according to a new survey.

Two-thirds of 200 venture capitalists don’t expect their investment levels to pick up for at least another year, according to a survey by Deloitte & Touche.  That’s consistent with last year’s trend that saw three consecutive quarters of falling investment for the sector.

However, despite declining levels of investment, last year still saw a record level of venture capital investment.

The study found that Investment in network hardware and software, wireless and telecommunications, and enterprise-software companies is expected to continue attracting new investments.  But 61% of survey respondents said that Internet companies will receive less funding this year.

Nearly all (95%) of the survey respondents anticipating a liquidation of their investment in the next six months expect to do so through a merger or acquisition, rather than through an initial public offering (IPO).  Just 1% expect their start-ups going public over the next six months.


 

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