<article>Venture capitalists poured $15 billion into startups in the third quarter, putting this year on pace to be the third largest ever for investment activity, according to a report released on Thursday.</article>

Venture capitalists poured $15 billion into startups in the third quarter, putting this year on pace to be the third largest ever for investment activity, according to a report released on Thursday.
So far this year, venture-backed companies have raised $56 billion across nearly 6,000 funding deals, according to a report from venture capital database PitchBook Data Inc and the National Venture Capital Association. At that pace, venture investment is projected to hit $74 billion by year&#8217;s end, falling short only of the investment levels in 2000 and 2014.
The data shows that despite long-held fears of a contraction in venture capital that would force startups out of business, investors continue to enthusiastically back promising technology companies.
&#8220;The rounds keep getting bigger,&#8221; said Adley Bowden, vice president of analysis for PitchBook. &#8220;As valuations go up and (venture) firms are trying to get a certain ownership percentage, the check size goes up as well.&#8221;
Late-stage venture rounds have spiked most significantly, with the median round size at about $10 million, up from a little more than $6 million in 2013.
&#8220;The Airbnbs and the established unicorns &#8230; are not having trouble raising capital and very large rounds,&#8221; Bowden said.
Mutual funds, hedge funds and sovereign wealth funds &#8211; contrary to widely held expectations that they would flee venture capital amid the slowing IPO market &#8211; continue to invest heavily in &#8220;unicorns,&#8221; the term for venture-backed companies valued at $1 billion or more. Uber Technologies Inc, for instance, raised $3.5 billion from Saudi Arabia&#8217;s sovereign wealth fund in June.
Unicorns appear to be gobbling up most of the venture capital, with angel and seed financing falling about 18 percent to $1.7 billion in the third quarter compared with a year ago, the result of more accelerators such as Y Combinator replacing seed investors as startups&#8217; first stop for cash, the report shows.
Venture capitalists appear to be spending money as fast as they are raising it. Firms have raised $32 billion so far this year, compared with $36 billion for all of last year.
Although money continues to flow into technology companies, little is flowing back toventure capital firms. The report takes a dour view on the IPO market, saying the &#8220;slump is unlikely to reverse.&#8221; The third quarter saw 162 exits &#8211; IPOs and M&amp;A deals &#8211; compared with 237 a year ago.
&#8220;A lot of unrealized gains are in the venture funds right now,&#8221; Bowden said.
<h4>Reuters</h4>

Venture capitalists poured $15 billion into startups in the third quarter, putting this year on pace to be the third largest ever for investment activity.

Venture capitalists invest $56b in startups so far in 2016

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Venture capitalists invest $56b in startups so far in 2016

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