Which startups are making big bucks?
The latest startup money is hitting a big new bump as a result of a big wave of tech innovation.
According to the U.S. National Venture Capital Association (NVCA), the industry has added $6.3 billion to its overall market value since the beginning of the year.
But this year, that number is set to rise even higher, as the tech sector has become more tech-savvy and more financially diversified.
The NVCA data indicates that venture capital investment is up more than 25 percent from the same time last year.
And this is the fastest increase in the last four years, says Steve Vavreck, the president of the NVCI, an industry trade group.
The NVCB, a trade group for venture capital, tracks the total value of all venture capital investments, as well as the number of companies that have entered the space and their expected returns.
And for the first time, venture capital has been growing at a faster rate than all other types of investments.
That’s largely because of the growth of cloud computing, which has increased dramatically over the past several years.
“You had some big investors in the early years of the dot com bubble, and they weren’t doing a lot of it, but they were making a lot,” says Vavack.
“The dot coms are back and dot com is back and that’s really been a good story for investors.”
As more companies have been entering the market, VCs have been paying close attention.
“We’re in a period of tremendous innovation and growth in the space,” says Matt Krempe, cofounder and chief investment officer of Silicon Valley investment firm Kremper Ventures.
“We have a lot more to offer.”
The NVRA data shows that venture investments jumped nearly $1 billion in the first four months of 2017, up from $1.7 billion the same period last year, according to the NVRB.
And investors are seeing the benefits.
The tech sector is making a comeback and has created a new generation of leaders in the tech industry, says Vakrek.
It’s not just the best and brightest that are investing in startups, but people who have the potential to do a lot in the industry.
“I think there’s been an incredible surge in venture capital interest over the last couple of years,” says Kremp.
“That has resulted in more companies getting funded, and that has resulted, of course, in a greater number of VCs getting in on the ground floor.”
Vavreck says that in many ways, the success of these startups is a result not only of the tech and the blockchain, but also the rise of other startups.
“The next five to 10 years is going to be the most interesting time for VCs, period,” he says.
“This is going be a very different environment, in many respects, than we had five years ago,” says Bill Lee, co-founder of BlockChain Capital.
“You’ve got this incredible growth in technology and the ability to build a much larger number of products that you can sell and distribute.
We’re in an era where you can make money from everything, so you’ve got to have the right people at the right places.”
In the coming years, Vavrek says, it’s likely that more companies will enter the market and start to build products and services.
But the big question for investors is whether the next generation of tech giants will be ready to take on the big players.