Venture capitalists poured $106 million into Colorado companies during the first quarter, with information technology companies accounting for half of the deals, according to a survey to be released today by accounting giant Ernst & Young.
The state’s three-month haul was down 6.3 percent from the first quarter of 2006, when nascent Colorado companies raised $113.1 million. The number of deals also declined, falling to eight deals in the first quarter, down from 18 in the same quarter of 2006.
“The venture capital environment remains stable and healthy in Colorado,” said Michael Schoenfeld, a director of the venture capital advisory group for Ernst & Young. “The results were good.”
Business and consumer services companies landed $47 million, the most of any sector. The health care sector came in next at $37.3 million, followed by information technology at $21.8 million. Information technology companies, however, represented four of the quarter’s eight deals.
Among the largest deals in Colorado was a $32 million financing for Market Force Information, a Boulder-based company that provides mystery shopping services for restaurants and retailers.
Nationally, venture capital investment surged by 8 percent to $6.96 billion during the quarter. The number of deals reported was 584, down by 31 deals compared with the first quarter of 2006.
“An improved exit climate for venture-backed companies via both initial public offerings and mergers and acquisitions has opened the door for more new companies to secure venture capital financing,” Joseph Muscat, a director for Ernst & Young, said in a statement.
VentureOne, a San Francisco research firm, prepared the report with Ernst & Young.
Staff writer Will Shanley can be reached at 303-954-1260 or wshanley@denverpost.com.
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$106 million
Amount venture capitalists gave to Colorado companies in the first quarter of 2007
6.3 percent
Decline in venture capital money compared with first quarter 2006
