October 15, 2010, 7:15 am — Updated: 7:15 am -->
Venture capitalists poured less money into U.S. start-ups in the third quarter and split this among more companies, signaling that investors are trying to be more economical with their funds, Reuters reported.
According to a study set to be released Friday, start-up investments declined 7 percent to $4.8 billion in the July-September period, compared with $5.2 billion invested during the same three-month period in 2009. A total of 780 start-ups received funding during the quarter — 9 percent more than the 716 companies that took slices of the investment pie last year.
The study, which was conducted by PriceWaterhouseCoopers and the National Venture Capital Association based on data from Thomson Reuters, said that much of the decline stemmed from a drop in large investments in clean technology. Funding in clean-tech start-ups, which include alternative energy, recycling, conservation and power supply companies, has been mercurial lately. It fell every quarter last year compared with the previous year, but has been climbing this year — until the third quarter.
Despite the third-quarter funding drop, though, funding for the full year still looks to be higher than it was in 2009. So far this year, venture capitalists have invested $16.7 billion in 2,497 start-ups; in all of 2009, $18.3 billion was funneled into 2,916 start-ups.
Go to Article from The Associated Press via The New York Times »