Nashville Technology Blog Post (4/30/10)
Lately, it appears venture capital investments are seeing an upgrade of their own — a 13% increase in investments was made in Q1 2010 alone according to a story out today in Mashable quoting Dow Jones Venture Source. In all markets except Europe, VC seems to be slowly crawling up from the all-time lows of the recession.
An earlier report that confirmed VCs were getting more funds than they had received since the beginning of the 2008 market crash. We wondered if this recovery would trickle down to investments in tech startups. Today’s report from Dow Jones gives us more cause for optimism — while Q1 2010 amounts and deals aren’t as rosy as the figures seen in Q4 2009, year-over-year numbers show a definite if modest rise.
Not only are VCs’ funds being replenished, they’re also making more deals than they were in previous quarters. Globally, 919 venture capital deals were inked in Q1 2010. These investments totaled $7 billion. The U.S. market accounted for the majority of both deals made (65% of the worldwide total) and dollars invested (67%).
Locally, we have seen two recent investments by TNInvestcos including: New Day Pharmacy and onFocus Healthcare. It does look brighter, but is it enough to rejuvenate a whole sector? Only time will tell.
The data show that in the U.S., tech deals account for more of the total than other types of investments, and that the trend toward smaller, more cautious dollar amounts for financing rounds continues.
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