Venture capital on track to set record
November 14, 1999
DenverDenver — Venture capital continued to flow into Colorado at an unprecedented pace in the third quarter, bringing $307.2 million to 38 companies. — Venture capital continued to flow into Colorado at an unprecedented pace in the third quarter, bringing $307.2 million to 38 companies.
Denver — Venture capital continued to flow into Colorado at an unprecedented pace in the third quarter, bringing $307.2 million to 38 companies.
So far this year, venture capitalists have invested nearly $700 million in Colorado companies, putting 1999 funding well ahead of the record set in 1998, when Colorado companies raised $519.4 million all year, according to a survey by PricewaterhouseCoopers.
”This was the biggest quarter ever,” said Don Keller, who oversees the Colorado survey for PricewaterhouseCoopers. ”We are on track for a $1 billion year.”
Keller said one statistic overshadows the amounts raised. He said the 38 companies that raised venture capital during the quarter shattered the previous quarterly record of 15.
”What’s driving the trend more than anything else is additional capital,” Keller said. ”There’s just too much money out there.”
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Colorado’s trend was reflected nationally, with third-quarter venture capital investments totaling $9.04 billion, a 138 percent increase over the $3.79 billion recorded in the same period in 1998.
In Colorado as well as the nation, technology companies continued to attract the lion’s share of venture capital.
”Technology companies are attracting venture capital at astounding rates,” said PricewaterhouseCoopers managing partner James Atwell. ”This is further evidence that technology is driving the U.S. economy.”
Skewing Colorado’s third-quarter results was a $115.8 million investment in Denver-based Formus Communica-tions, which provides high-speed data, voice and video transmission services.
Jato Communications, a Denver-based high-speed Internet access and applications company, raised the second-largest amount of venture capital in the third quarter, with a $27.5 million investment.
The third-largest investment, a $25 million stake, went to Broomfield-based Requisite Technology, which helps businesses maintain online catalogs.
Bucking the trend, however, was the company earning the state’s fourth-largest amount of venture capital in the quarter. Chipotle Mexican Grill, a chain of 31 restaurants in Denver; Phoenix; Minneapolis; Kansas City, Mo.; and Columbus, Ohio; raised $20 million in the quarter.