Private company research firm CB Insights (formerly known as Chubby Brain) on Tuesday released new venture investment data for the first quarter of 2010. Overall, the news is very positive with strong growth in the number of deals from 687 in the fourth quarter of 2009 to 731 in the first quarter of 2010.
The first quarter of 2010 saw $5.9 billion invested across 731 deals, a marked increase over the year-ago quarter when $3.9 billion was invested across 483 deals. "The psychology and sentiment of entrepreneurs and venture capital investors continues to improve, albeit cautiously," the report concluded.
And while CB Insights notes that $5.9 billion remains far below quarterly levels seen before the '08-'09 recession, there is some belief (that I share) that "the VC asset class has perhaps reset at a lower but ultimately more sustainable and healthier level."
The fact that VCs are opening their collective wallets, even for smaller deals, is good news for both entrepreneurs and the economy as a whole. That said, there is still probably too much money still sitting on the sidelines.
What's interesting to note is the vast disparity in the number of deals by sector, where health care and Internet outpace all other categories by at least 3 to 1 in number of deals.
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