Price Waterhouse Study

Price Waterhouse, in conjunction with the National Venture Capital Association, recently published the results of the 1996 National Venture Capital Survey. Venture capitalists reported investing $9.5 billion in 1996, a 25% increase over 1995.

Approximately 2,000 companies received venture backing with funds going to companies in all stages of growth, from start-up to turnaround. More than one-quarter of all companies received early stage financing: either initial/seed or first round. Follow-on investments accounted for 15% of companies and 10% of funds.

Price Waterhouse, which reports its information by region rather than by state, reported Silicon Valley remained the leader of venture capital with 552 companies attracting $2.29 billion. New England retained the number two position with 330 companies garnering $1.27 billion. The Southeast received $1.08 billion, followed by the Midwest with $895.8 million, Texas with $668.8 million, and the New York Metro area with $662.5 million.

The industry sectors receiving the most venture capital in 1996, according to Price Waterhouse were:

Industry Sector (Millions of $) Percentage Software & Information 2,227.7 23.9% Communications 1,827.9 19.2% Consumer 861.8 9.1% Healthcare 784.6 8.2% Industrial 728.2 7.6% Biotechnology 654.0 6.9% Distribution/Retailing 559.6 5.9% Business Services 473.5 5.0% Computers & Peripherals 379.6 4.0%