VC Activity Heats Up

Posted: October 19, 2011 in CRM, Economics
Tags: , ,

Attention please: venture capitalists are giving out money again — lots of it.

In the last few days the news news reported at Deals&More shows a very healthy venture capital industry making moves in the software market.  Late stage companies like Box.net ($81 million) and Dropbox ($257.2 million thank you veddy much) led the way.

Following the go big or go home mantra, established companies taking home big purses said they are in the market to expand and perhaps make some acquisitions in advance of future IPOs.  According to reports, Dropbox, the largest recent deal had multiple participants including leader Index Ventures, and other investors Goldman Sachs, Benchmark Capital, Greylock Partners, Institutional Venture Partners, RIT Capital Partners and Valiant Capital Partners.  Two prior investors, Sequoia Capital and Accel Partners, also participated.

What’s interesting and good is not the size of these deals but the others that have been reported such as Clickable $12 million; Tidemark $11 million; Waze $30 million; and BillGuard $10 million.

These smaller deals show that capital is again flowing into earlier stage companies that offer more risks as well as rewards.  They also show an increasing appetite for risk among investors due in part to several successful IPOs earlier this year.  According to VentureBeat software and consumer web companies raised $2.66 billion from 281 deals in the first half of 2011.

All this cash invested is part of the reason there are so many job openings in the northern California technology market and why these jobs are so hard to fill.  They also speak to the prospect of a continuing IPO boom in the years ahead.

Can a bubble be far behind?

So, what did you think?

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