Percentage of VC investment in IT industry continues to drop in ...

The percentage of venture capital investment in the IT industry dropped to 50.7 percent in the first quarter of 2007, according to a report released this week by Zero2ipo Group, a service provider in China's VC and private equity industry.

In the first quarter of 2007, 67 Chinese businesses received an aggregate of $419 million from VC, up 25.5 percent annually. A total of $253 million was invested in 34 Chinese IT businesses.

More VC investment flowed into the bio-health care industry in the first quarter, according to Zero2ipo. Nine businesses received $66.9 million, surpassing half of the total the industry received for all of 2006.

Bio-health care and services accounted for 13.4 percent of all VC deals, the second largest percentage after that for the IT industry.

With the fading of the Web 2.0 craze, IT investment has gone back to a rational state, Zero2ipo pointed out in an earlier report. In 2006, IT investment dropped and the VC investment market showed a trend of diversification.

In the first quarter of 2007, there were 20 exit events, including nine in broad IT, which accounted for 45.0 percent of the total.

As for exit routes, IPO, trade sale, and M&A, accounted for 50 percent, 25 percent, and 10.0 percent of the total respectively.