Venture capital rebounded nicely in '04
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Reversing three years of declining investments, venture capital firms plowed nearly $21 billion into emerging companies in 2004, according to the MoneyTree survey being released this morning.
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(InfoWorld) - With the first six months of the year gone, IT companies are riding high in the markets, and mergers and acquisitions have helped stoke investor interest in technology. The tech-heavy Nasdaq Composite gained 7.8 percent in the first half. The day before the U.S. Independence Day holiday on July 4, the Nasdaq rose 12.65 points to close at 2644.95, a six-and-a-half year high. Most analyst firms are still predicting modest overall global IT spending growth of about 6.5 percent above last year. But strong corporate earnings, better-than-expected growth in certain sectors, and M&A activity are contributing to a sense of exuberance, especially in certain sectors. Both Gartner and IDC have recently raised predictions, for example, for PC shipment growth this year. Now comes news that M&A deals continue to experience a torrid pace. For the first six months of the year, 1,930 deals worth about $347 billion were reported, according to The 451 Group. While the number of deals declined slightly from last year, the dollar value skyrocketed about 50 percent from last year, according to a 451 Group report. About half the deals involved acquisitions by public companies, and half involved private equity companies. Also, the pace of M&A is accelerating, according to the report. After $95 billion in M&A deals in the first quarter, second-quarter M&A spending jumped to $252 billion. IT is getting a lion's share of M&A dollars. For example, in the first six months of the year, IT services deals amounted to about $94.7 billion, while software deals excluding storage and security companies amounted to $27.6 billion, according to 451 Group. These days, M&A activity is being seen as a healthy sign. That was not always the case. "PE (private equity) used to buy broken companies," noted 451 Group financial analyst Brenon Daly. But now there are various reasons why IT services and software companies are targets, he noted. "It's not a great time to be a public company," Daly said. For example, there is a lot of scrutiny on companies being brought to bear by Sarbanes-Oxley rules, he noted. Thus, there are a lot of willing buyout targets, especially among smaller companies, he said. IT services companies are popular targets because once the difficult sales cycle is accomplished, long-term contracts lock in revenue for a foreseeable period, Daly said. Software companies in mature markets may see new license revenue slowing down but have a solid business in maintenance revenue. Though 451 does not track telecommunications deals specifically (telecom M&A is included in its total tally, however), recent telecom deals have also excited the market. For example, AT&T's announcement FridayÂ it would buy carrier Dobson CommunicationsÂ for about $2.8 billion helped lift the Nasdaq to its high level earlier this week. M&A deals help boost IT investor interest in several ways, noted Daly. First of all, as companies are bought and taken off the market as targets, there are fewer companies to invest in, even as a liberal lending regime continues to stoke opportunity and interest. Also, M&A sparks a continual guessing game of Who's Next? Excited investors essentially place bets on companies they think will be the next to be snapped up. It's not all smoke and mirrors, though. Several quarters of healthy corporate earnings have given a solid underpinning to investor interest in tech. The earnings-report season is getting underway in the next few weeks, and industry watchers will get a sense of how the next six months will play out.
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Venture capital investments in U.S. startups climbed to a six-year high of $29.4 billion in 2007, raising hope that ample money will still be available to back promising new ideas
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As 2004 draws to a close, it should come as heartening news that this past year was one of the most prosperous in history. Not because the American economy grew by a solid 4.3 percent.
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WASHINGTON -- Orders to U.S. factories for big-ticket manufactured goods posted a moderate increase in April, helped by a continued rebound in business investment.
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InfoWorld - U.S.-based venture capital investments reached their highest point last year since 2001 with software remaining the strongest category, according to The MoneyTree Report, released this week by PricewaterhouseCoopers and the National Venture Capital Association (NVCA).
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US stocks enjoyed a modest rebound on Monday, led by energy and technology companies, helping offset worries about the threat of new turmoil in credit markets.
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Earnings season is in full swing, and results this week from bellwethers like Google, Intel, and Nokia are fueling hopes for a strong fourth quarter while confirming the investor confidence that has led to a rebound in share prices of technology vendors.
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Stocks lifted modestly after investors appeared unfazed by drops in manufacturing growth and construction spending.
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The initial public offerings of  67 venture capital-funded U.S. companies raised $4.98 billion  in 2004, more than tripling from the $1.41 billion raised in 22  deals during 2003, VentureOne said on Saturday.
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Start-ups came back in style. IPO fever gripped Silicon Valley. Blogging went mainstream. 2004 was a year of dubious distinctions along with steady innovation and successes. -The Washington Post
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US stocks rebounded strongly on Thursday after MBIA (NYSE:MBI) helped alleviate some of the concerns about troubled bond insurers at the end of the worst January for equities since 1990.
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It is back to business for U.S.  initial public offerings and time to see if the market for new  issues can pull out of its end-of-summer slump.
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Venture capital investments in U.S. startups climbed to a six-year high of $29.4 billion in 2007, raising hope that ample money will still be available to back promising new ideas even if the staggering economy falls into a recession.
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After an early morning skid, markets rebounded, boosted by an optimistic earnings report from Merck and a more favorable outlook for the technology sector.
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Investor's Business Daily - Asset management and mutual fund firms have regained their sea legs after riding out a stormy summer.
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The shares rebound after the company recalled a product.