(Reuters) – Companies with venture capital support in the United States raised nearly $ 130 billion last year, setting a record despite the COVID-19 pandemic, figures from data firm CB Insight released on Friday ‘show.
While total investment is up 14% from 2019, the number of contracts is down 9% to 6,022. And so-called mega-rounds, contracts that are $ 100 million or more also hit the highest and the number with $ 63 billion raised in 318 contracts.
“What we are seeing is a ‘rich get rich’ phenomenon where successful, high-tech technology companies are draining most of the funding,” CB Insights chief executive Anand Sanwal told Reuters by e-mail.
He said data showed a sharp drop in early stage investment known as seed rate, and expected that some of those companies that stand out would see “unstable investment demand” with more fewer competitors for the money.
Large investment movements are unlikely to slow down in 2021 with large amounts of money running investments, say some venture capitalists.
Already on Thursday Quantum Metric, a startup company that provides messenger analytics and development tools to online businesses, said it has raised $ 200 million in its latest round of funding, which adds more than $ 1 billion on the company.
In 2020, many of the mega tours were built by COVID-19-powered tech companies, which set up remote work and e-commerce.
“Capital tends to follow high-profile sectors. And I think right now you’re seeing a lot of conviction behind divisions and companies riding unbelievable trends, ”said Arun Mathew, a partner at Silicon Valley venture capital firm Accel. an early investor in Facebook.
“I think it’s very safe to say that 2021 is going to be a flagship year for a lot of tech companies,” Mathew said.
Edited by Jacqueline Wong