Wednesday, February 21, 2007

Valuations of VC-Backed Companies Reach Highest Level Since 2000

U.S. venture-capital backed companies are being valued at the highest level since 2000, according to a report released on Wednesday by Dow Jones VentureOne. The median pre-money valuation -- the values ascribed to businesses prior to funding rounds -- reached $18.5 million in 2006, up from $15.9 million in 2005. In the fourth quarter alone, the figure reached $20 million, up from $11.7 million the prior year. The figures can be largely credited to sharply higher valuations placed on information technology and healthcare companies, which are finding more opportunities to achieve liquidity through IPOs and acquisitions. "In 2006, the U.S. had the strongest exit climate in several years," said Steve Harmston, the director of global research for VentureOne.


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