Corporate VC investing up to 2002 levels

In the second quarter of 2006, corporate venture capital investment reached its highest level since the first quarter of 2002, according to a new report by PricewaterhouseCoopers and the National Venture Capital Association based on Thomson Financial data.

Corporate venture capital is defined as operating corporations investing directly in portfolio companies, either on a solo basis or alongside traditional, independent venture capital funds. These corporate entities are in some cases referred to as strategic investors.

During the three months ended June 30, 2006, corporate venture capital groups participated in 195 deals or 22.2 percent of all venture capital deals completed. These deals represented $602.5 million or 9.2 percent of all dollars venture capitalists invested in the quarter. This activity has been steadily increasing during the last 18 months. Breakout regional data was not available.

For the first six months of 2006, 358 companies received corporate venture capital dollars. The combined total was $1.045 billion or 8.2 percent of all venture capital dollars invested.
The sectors receiving the highest percentage of corporate dollars in the first half of 2006 were telecommunications, biotechnology and software at 15.3 percent, 15.2 percent and 14.6 percent, respectively. The highest percentages of corporate deals were completed in software, biotechnology and medical devices at 23.0 percent, 13.9 percent and 10.7 percent, respectively.


from Sacramento Business Journal
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