Seattle area ranks third in venture capital growth

The Seattle area ranks third in venture capital growth over the past decade– Venture capital (VC) investments in the state continue strong, and the Seattle area is the third fasting growing region in the past decade according to a recent report. The two fastest growing areas, New Mexico and Pittsburgh, are much smaller in terms of dollars invested, so they have more room to grow faster. Of course, the 800 pound gorilla remains California, but relatively speaking, the Puget Sound region is stronger.

Investments in the area have remained strong in early 2008, although slightly below last year’s level, virtually ensuring that the relatively tight tech and related labor markets will continue for a while, at least. The areas doing well recently are software, biotech, wireless, and “clean” technology, such as biodiesel.

Most analysts and VCs believe that current funding levels are healthy and sustainable, barring a major hit to the economy and/or equity markets. This should keep the regional area from any near-term significant drop-off in labor demand in technology oriented industries, like what happened in the 2001 – 2002 period.