U.S. venture capital investing continued to grow at a torrid pace in the third quarter, totaling nearly $28 billion, according to a report by PitchBook and the National Venture Capital Association. Total venture investments for the year are on pace to top $100 billion, up 22% from the prior year and better than the 7% annual growth rate in 2017.
That could set a record. One of the big reasons for the surge is the increasing prevalence of so-called “mega-rounds” of $100 million or more raised by more mature private tech companies. With so much money chasing deals and inflating valuations, the natural question is whether things are getting overheated, and what happens to private markets when there’s a correction in the wider economy. For now, companies are showing strong growth and businesses are stockpiling cash. As long as they continue to go public or get acquired at higher prices, venture capital investing will continue to get bigger.