U.S. Venture Investing Hits Five Year High, Southern California Shines

Ernst & Young and Dow Jones VentureOne are reporting today that U.S. Venture Capital investing his a five year high in 2006, reaching $25.75B in investments. According to the report, there were 2,454 venture deals for the year nationally. From a regional perspective, California has become the top spot for venture capital investment in 2006, with 1,082 deals and $12.36B invested, and the report noted that Southern California has grown in particular, led by increased investment in health care and information services companies. According to numbers released by Ernst & Young and Dow Jones, for the first year ever, capital investment in Southern California surpassed the total amount invested in New England in 2006. The report cited 239 deals in Southern California, and a 25% increase in capital invested in the region, to $3.11B for the year. In other results, the report found that, despite the increase in investments for the year, the fourth quarter of 2006 was the slowest quarter of the year, with 561 deals and $5.82B invested, a decline of 13% in deals and 2% in dollars from the fourth quarter of 2005. PricewaterhouseCoopers releases its quarterly results and local breakdowns tomorrow.