Venture capital investments up 64% in Q1 2006

Up rounds exceeded down rounds for the 9th quarter in a row, and by the largest margin since our survey began (74% up vs. 15% down, with 11% flat). The Fenwick & West Venture Capital Barometer showed a 64% average price increase for companies receiving venture capital in Q1 2006 compared to such companies’ previous financing round. The amount invested by venture capitalists in the US in Q1 2006 was approximately $6 bln, an improvement over $5.1 bln in Q105, and on par with the last 3 quarters of 2005.

Acquisitions of venture-backed companies in the US in Q1 2006 totaled $7.5 bln in 92 transactions. This was flat with $7.5 bln in 93 transactions in Q1 2005, and with 2005 on the whole, but is a significant improvement over $4.8 bln in 86 deals in Q405. There were 13 IPOs of venture-backed companies in the US in Q1 2006, of which 8 were healthcare companies. This was an improvement over the 8 IPOs in Q1 2005, and generally flat with the last half of 2005. Nasdaq was up 6% in Q105, but is down 7% in Q2 2006 to date.