New England Web 2.0 Companies Attract More Funding Than Their SiliValley Counterparts
According to a report released Monday, venture capitalists invested $464.2 million in 101 so-called Web 2.0 companies during the first half of 2007, a 7 percent increase from the same period a year ago and new record high. But less than 20 percent of this cash was invested in Bay Area firms.
“Investors are looking to diversify their Web 2.0 portfolios so they are looking at new regions,” said Valerie Foo, research manager at Dow Jones VentureOne.
So what’s hotter than the Valley? New England. This shouldn’t come as a huge surprise since the Boston area, with all its colleges and universities, has always been a training ground for engineering talent.
While there were many more deals involving Bay Area companies in the first half of the year– only 10 New England Web 2.0 firms received a round of financing compared to 25 in the Bay Area — the New England firms received $102 million to the Bay Area’s $91 million. The big reason for New England’s surge to the top of the VC money list was due to a $30 million investment in Cambridge, Mass.-based enterprise software developer n2N Commerce.