Flickr photo via Justin D. Miller
Flickr photo via Justin D. Miller

Facebook gobbles up WhatsApp and Oculus in multi-billion dollars deals. Tech IPOs take Wall Street by storm. And more than two dozen private companies raise financing rounds at valuations of $1 billion or more.

Yes, sports fans, here comes chatter of the “B word” again: Bubble.

And that talk is backed up by the numbers, with PricewaterhouseCoopers and the National Venture Capital Association releasing their quarterly MoneyTree report, one which shows that venture capital investing levels have hit highs not seen since the second quarter of 2001. You may recall that period when companies such as Loudeye, HomeGrocer and ShopNow were flying high —just before the big bust hit.

According to the MoneyTree report, venture capitalists sunk $9.5 billion in 951 deals, a 12 percent increase in dollars invested compared to the fourth quarter. In the first quarter of 2001, $13 billion was invested, dropping in the second quarter of 2001 to $8 billion.

seattle-investing1Things are certainly different today. Companies like Tableau Software, Zillow and Zulily, which have entered the public marketplace, have real revenues and, in some cases, real profits. Nonetheless, some have argued that it’s getting “frothy” out there, with valuations soaring to new levels.

In Washington state, investment levels took a downward turn in the first quarter, with $172 million invested in 26 deals. That was off from $485 million invested in 37 deals in the fourth quarter, propelled in part by one massive deal of more than $100 million in Seattle-based Juno Therapeutics. In the first quarter of 2013, $89.8 million was invested in Washington state.

The MoneyTree Report is one of many released in recent days showing venture capital activity in the U.S. Dow Jones released its VentureSource report earlier this week, finding that $10.74 billion was invested in 862 deals as companies such as Cloudera, Lyft, TangoMe and others raised huge rounds.

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U.S. venture capital investments by quarter. Source: VentureSource

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IPOs by quarter. Source: VentureSource

Comments

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  • Dave

    Take out the few very large deals, which are essentially in lieu of IPOs or allowing significant deferral of IPO timelines, and you end up with much more normal looking charts. Clouderra alone is nearly 10% of the quarterly total.

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