First-Round Entrepreneurial Investments: Where, When and Why?

This paper examines the where, when and why of first round entrepreneurial investment activity in the United States from the first quarter of 1995 until the second quarter of 2010. The paper analyzes these venture capital investments taking into consideration the role of macroeconomic variables, region, and industry. Additionally, trends in regional and industrial investments are evaluated using statistical and graphical analyses. By studying these findings, we are able to understand the impact of different periods of economic growth on venture capital investments. Lastly, the shock of the dot.com bubble and recent financial crisis are integrated into the findings.