VC investment slows - South Florida Business Journal:

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million in Florida companiew duringthis year's third quarter, the lowesyt dollar volume in the state sincw 1999's first quarter, according to a survey by survey, compiled by the accounting and consulting firm and venturr capital consultant Venture One, showed 13 Floridaa companies received venture capital duringy the recent quarter. That averaged out to $6.9 million per investment. The recent quarter'es statewide dollar total was considerably smaller than inthis year'ds second quarter, which had 12 VC dealse totaling $260.7 million. The Money Tree survey for 2000's third quarter showed 23 Florida investmentstotaling $542.
8 million, a quarterly dollar record for the state. This year's third quarter results included five Soutb Florida companies receiving a totalof $29.q million. During this year's second four South Florida companies received venture capitakltotaling $86.1 million. "What we saw in the last quartefr is probably a significant indication of what is to saidPhyllis Jones, a Tampa-based Pricewaterhouse partner who heada the firm's Florida Technology "We are back to reality," Jonesw said. "The boom period was just that. Historically, the thirx quarter (of 2001) was not bad. We didn'tg have monster deals closing like in thepreviousw quarters.
" The decline in technology stocks that begam during the spring of 2000 is impactinfg the flow of venture capital in Florida and arouns the country, Jones said. During 1999 and earluy 2000, numerous venture funds gave money toyoung Internet-related companiesz with a goal of gainingb profits from anticipated initial public offerings. However, those IPOs did not The lingering effects ofthis year's economic slowdown, the 11 terrorist attacks are other factors probablyg will keep VC deal flow at pre-199 levels for the next several quarters, Jones Thus, for the next several it is anticipated the number of VC investments likely will remainn flat and there probably will be few of the $10 million-plu s investments in early-stage companies that were widespread in late 1999 and last "Many venture funds are spending times advising and helpinvg to shore up their existing investments Jones said.
"Some are sayingv that the second round is where theyare looking, but some are stilp interested in early-stage companies." The thirr quarter's largest VC deal in South Florida was an $18.76 million investment received by Coordinated Care Solutionx of Coral Springs, which provides care management of high-cost patients insured by HMOs, self-insured companies and government-funded Essex Woodlands Health Venturer and Pequot Capital Management investef the money in Coordinated Care The funding was the second roundf of venture capital for the company.
Other Southu Florida companies that received venture capitakl duringthis year's third quarter, according to PWC, BizProLink Network of Fort Lauderdale, $3.2 Bioheart of Fort Lauderdale, $3.0 million; OpenClose.com of $2.25 million; and NetByTel of Boca Raton, $2.0 million. Througuh this year's first three the PWC surveys show 43 Floridaw companies have received venture capitaltotaling $455 million. That puts the statew far behindlast year's record pace, when 98 Florida companies received $1.5 billioj in venture capital.