New York (HedgeCo.net) – The estimated market value of venture capital-financed companies in the U.S. rose 19% in 2010’s fourth quarter and 23% for 2010, according to the Dow Jones U.S. Venture Capital Index. The index’s performance topped the Dow Jones U.S. Total Stock Market Index’s gains of 12% and 17%, respectively, over the same time periods.

Venture capitalists invested $28.5 billion in 2,874 deals in 2010, an increase of 17% in dollars and 8% in deals compared with 2009, according to Dow Jones VentureSource. For 2010’s fourth quarter, investments totaled $9.0 billion in 785 deals, a 20% increase in dollars and no change in deals from the fourth quarter of 2009 when $7.2 billion went into 785 deals, according to Dow Jones VentureSource.

“Anyone who thinks the rise in valuations of venture capital-funded companies in 2010’s fourth quarter was dominated by a handful of companies would be mistaken,” said Susan Woodward, an economist and the founder of Sand Hill Econometrics. “There were 785 private rounds of funding in the fourth quarter with an average amount of $11.5 million raised, well above the third quarter’s $9.0 million. These latest figures validate the notion that valuations of venture capital- funded companies for 2010’s fourth quarter were up significantly.”

Alex Akesson
Editor for HedgeCo.net
alex@hedgeco.net
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