There’s nothing surprising about venture capitalists investing in start-up Web 2.0 companies. Investment in Web 2.0 companies during the first half of 2007 is up 7% from the same period last year and everyone’s talking about social networking sites and wikis. What is surprising is where these companies are based.
A new report out today from data firm Dow Jones VentureOne provides details as to where the $464.2 million venture capitalists invested in these companies in the first half of this year has gone. CNNMoney.com’s Media Biz blog reports:
- Less than 20% went to Bay Area firms. $91 million in investment was spread across some 25 start-ups in the Silicon Valley area.
- New England got more money — $120 million for 10 companies. A large chunk of the cash, $30 million, went to a Cambridge-based enterprise software developer n2N Commerce.
- The Pacific Northwest was also hot. Venture Capitalists invested $25 in Oregon-based, MyStrands, a site where friends can recommend music and movies to each other. Zillow.com, our of Seattle got $25 million in July 2006.
- Southern California also attracted investment. L.A. based Reunion.com, a social netoworking site, received $25 million.
- Venture Capitalists are also looking globally and have invested $107.3 million outside the U.S. Firms receiving cash included Belgian and Israeli social sites.
Media Biz also notes how many of these start-ups are focused on social networking, and also points out that despite the chatter surrounding sites like Facebook and Bebo, few are expecting these sites to go public. Instead watch for these companies to sell to to large established media companies.
(Image of Boston postcard by Sgeulachdan, CC 2.0)
