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Price Waterhouse Study

March 07, 1997

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%