Venture capital investment in Europeâ??s technology companies last quarter fell to its lowest since the dotcom crash, according to data company Library House.
The decline to â?¬950m reflected nervousness among specialist investors about the world economy in the wake of the credit crunch.
The outlook looks bleak for technologists who are trying to raise money to get new ventures off the ground. Richard White at Library House said: "The fundamentals should be strong, because the majority of fund raisings do not have a debt component, but it appears that venture capital investors are as much prey to the current psychological uncertainties as everyone else".
Venture capital investment is tiny by the standards of private equity but is a vital stimulus to the commercialisation of ground-breaking technological research. The already high risks of the asset class have been increased in the eyes of investors by global financial instability. They invested â?¬450m less last quarter than in the first quarter of this year and â?¬350m less than in the second quarter of 2007.
