National Venture Capital Association Commemorates 35th Anniversary

Market Wire, February, 2008

The National Venture Capital Association (NVCA), the trade association representing more than 470 venture capital firms in the United States, is celebrating its 35th year of advancing public policies conducive to the start-up economy. Since 1973, NVCA has educated state and federal legislators, regulators, and academics on the contributions of venture-backed companies to the U.S. economy, innovation, and entrepreneurship.

"For 35 years we have been communicating the value and unique economic efficiency of this still relatively young industry. This decades-long dialogue serves not just our members, but all stakeholders in the venture capital ecosystem including pension fund participants, foundations, job seekers, and frankly, every American," said Mark Heesen, president, National Venture Capital Association. "From the creation of the biotechnology industry to the backing of household names such as FedEx, Google, Intel, Genentech and Staples, venture financing has proven to be an unparalleled, highly valuable contributor to the national economy and to our daily lives. Venture investment represents a mere 0.2 percent of U.S. GDP but is responsible for 10.4 million American jobs and $2.3 trillion in sales. No other asset class can lay claim to these achievements. We have a distinct story to tell and we look forward to the next 35 years of discussion," Heesen added.

The NVCA was founded in 1973 in Chicago, Illinois. The original charter was to facilitate communications amongst venture capital professionals. The inaugural Board of Directors comprised many pillars of the venture capital industry including Peter Brook, Ed Glassmeyer, Philip Greer, Ned Heizer, Charlie Lea, Dave Morganthaler, Lionel Pincus, George Quist, Ken Rind and Paul Wythes, among others. In 1977, the NVCA moved to Washington, D.C. to focus on public policy. Since that time, NVCA has been advocating for legislation and regulation that supports entrepreneurship and capital formation in the United States. Today, the NVCA membership comprises firms that account for more than 90 percent of the total venture dollars under management.

NVCA will honor its 35th anniversary throughout the year with a variety of programs and initiatives. In this spirit, the following 35 facts exemplify an asset class that is national in scope and unmatched in its impact:

Facts

1. The top ten states for VC investment in 2007 were 1) California, 2) Massachusetts, 3) Texas, 4) Washington, 5) New York, 6) Pennsylvania, 7) Maryland, 8) Florida 9) New Jersey, 10) North Carolina.

2. In the last 35 years, venture capitalists invested more than $441 billion in over 57,000 companies in the United States.

3. Minnesota and Pennsylvania were ranked third and fourth respectively in venture capital investment in the medical device sector in 2007.

4. Washington and North Carolina were ranked fourth and fifth respectively in venture capital investment in the biotechnology sector in 2007.

5. Of the top 10 states for venture capital investment in 2007, Washington had the highest five-year growth rate for investment dollars at 124.2 percent.

6. States where VC investment grew 100 percent or more in the last five years include: Washington, Oregon, Kentucky, District of Columbia, New Mexico, Indiana, Kansas, Mississippi, Vermont, and Iowa.

7. The San Diego metro region was the second largest metro region for life sciences investing in 2007.

8. The top five area codes for VC investing in 2007 were 650, 408, 858, 617, and 415.

9. More than 1400 seed and early stage companies received venture capital investment in 2007.

10. The average venture capital round in 2007 was $7.7 million.

11. The Clean Technology Sector, which includes alternative energy, pollution control and clean power supplies, has had the most venture capital investment growth in the last five years.

12. The Biotechnology Sector received the most venture capital seed money in 2007.

13. New York City had the second highest number of venture-backed acquisitions in 2007 after San Jose.

14. One U.S. job was created for every $25,000 of venture capital invested between 1970 and 2006.

15. Venture-backed companies we encounter everyday include FedEx, Starbucks, Home Depot, Staples, Outback Steakhouse, and Whole Foods.

16. Internet companies founded by venture capital include Google, eBay, AOL, Facebook, YouTube, Netscape, and Shutterfly.

17. Every one dollar of venture capital investment between 1970 and 2006 created $5.60 of U.S. revenues in 2006.

18. Venture-backed companies consistently grow faster than their non-venture-backed counterparts.

19. One out of every three Americans has been positively impacted by a venture-backed medical innovation.

20. Lifesaving medical innovations brought to market by venture capital include the pacemaker, MRI, ultrasound, angioplasty, and stent grafts.

21. Venture-backed medical innovations that improve quality of life include glucose self-monitoring, Flumist, and spinal implants.

22. Venture capitalists invest in innovations that seek to eradicate leading causes of death in the United States including cancer, heart disease, stroke, diabetes, spinal injuries and respiratory disease.