US IT venture unvestments up 11% in Q2 2004

Companies in software and other IT sectors got $3 bln in venture funding in Q2, 11% more than in Q1 and more than any other industry, according to a survey by Ernst & Young and VentureOne. Software companies received $1.2 bln in venture-capital funding in Q2, tops among IT categories, according to the separate MoneyTree survey by PricewaterhouseCoopers, Thomson Venture Economics, and the National Venture Capital Association. Software companies attracted $250 mln in first-time investments in Q2 versus $185 mln for biotech companies. In the first half of the year, software outpaced biotechnology, attracting $2.2 bln in VC investment versus biotech's $1.9 bln, according to the MoneyTree survey. Early-stage investments were $1.2 bln in Q2, a two-year high, according to the MoneyTree survey.