Corporate VCs set record with more than $12 bln deployed

Corporate venture investments continued to soar this year, with dollars deployed already topping $12 billion and eclipsing those of last year.

If the pace of activity holds up, the year will end with a new 18-year record and one that comes close to topping the all-time record set in 2000, when the dot-com boom was at its height.

Data from Thomson Reuters show that through early November, CVCs poured $12.2 billion into U.S.-based startups. That’s already 5 percent above last year, which itself was the previous post-2000 record.

At this pace, the year could reach $14.5 billion, or just a little shy of 2000’s $17.9 billion, according to the data.

With technology and business-model innovation threatening old-line businesses, corporate motivation to participate doesn’t appear ready to slow.

Not surprising, the corporate interest is broad. Software and services startups have attracted the biggest share of the capital, or 29 percent. But internet specific companies won $2.8 billion, followed closely by biotech ventures, attracting $2.5 billion.

Other medical and health-related investments drew $785 million.

Deal volume so far is essentially flat with last year’s, with CVCs participating in 1,025 deals though early November. By the end of the year, that could rise to more than 1,200, trailing the 2,083 of 2000 but also setting an 18-year record.

According to PitchBook and the National Venture Capital Association, corporate participation in venture capital rounds is also ahead of last year. Through the third quarter, CVCs have joined venture deals with the accumulated value of 39.3 billion. That represents 46.7 percent of venture-capital deal value in the United States. It is an increase from 44.2 percent last year.

Larger rounds sizes help explain this rise.