What Industries Venture Capitalists Are Hot For

Dow Jones VentureSource released its U.S. venture capital report today showing where VCs were investing, both by industry and geographically in 2013.

learn more about Catherine Clifford

By Catherine Clifford

Opinions expressed by Entrepreneur contributors are their own.

If you are an aggressive entrepreneur gunning to grow a company quickly, then venture capital is probably your game. If you are going to try to pitch a VC, best go in with your eyes wide open, knowing what they want and where they are spending money.

In 2013, venture capitalists in the U.S. did more deals in information technology than any other industry by far, according to data on the market released today from Dow Jones's news and analytics platform, DJX. And while VCs did fewer deals in healthcare, U.S. VCs spent just as much in total on healthcare entrepreneurs than they did on IT entrepreneurs last year. That means that each deal that a VC signed with a healthcare entrepreneur had a larger price tag than did the average IT deal.

Related: Contently's New $9 Million Crown Proves Content Is King

After information technology, venture capitalists did more deals in business and financial services than any other industry. And after healthcare and IT, U.S. VCs spent more money on business and financial services than any other group of startups. Check out these charts showing in further detail where VCs invested their money in 2013, broken down by industry.

Click to Enlarge+

What Industries Venture Capitalists Are Hot For

Source: DJX VentureSource

The end of 2013 saw a handful of large venture capital raises. Cloud-based storage company DropBox raised $250 million, social-media platform Pinterest raised $225 million and Nest Labs, which was recently acquired by Google, raised $150 million. All three are based in California's Silicon Valley.

Related: Head in the Clouds: Dropbox Reportedly Valued at $10 Billion

The locations of these big deals are indicative of where the heart of the market is located. Venture capital, as an industry, is still predominantly a West Coast game. In the last three months of the year, 250 San Francisco-based startups received VC funding, compared to 129 in New York and 90 in Boston. Here's a look at where the startups that got funding in the fourth quarter were located.

Click to Enlarge+

What Industries Venture Capitalists Are Hot For

Source: DJX VentureSource

Related: $3M Jackpot: Google and Chase Give a Quarter Million Dollars to a Dozen Entrepreneurs

Catherine Clifford

Senior Entrepreneurship Writer at CNBC

Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at Entrepreneur.com, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.

Related Topics

Editor's Pick

Everyone Wants to Get Close to Their Favorite Artist. Here's the Technology Making It a Reality — But Better.
The Highest-Paid, Highest-Profile People in Every Field Know This Communication Strategy
After Early Rejection From Publishers, This Author Self-Published Her Book and Sold More Than 500,000 Copies. Here's How She Did It.
Having Trouble Speaking Up in Meetings? Try This Strategy.
He Names Brands for Amazon, Meta and Forever 21, and Says This Is the Big Blank Space in the Naming Game
Business News

These Are the Most and Least Affordable Places to Retire in The U.S.

The Northeast and West Coast are the least affordable, while areas in the Mountain State region tend to be ideal for retirees on a budget.

Management

5 Things I Learned as the CEO of a Fully Remote Company

As the CEO of a company that was an early adopter of a fully distributed workplace model, here are five important lessons I've learned from the experience.

Marketing

Want Your Self-Published Book in Bookstores? Here are 3 Major Tips On How to Make It Happen.

As a publisher for over eight years, here are some of my best tips for how to self-publish a book in a way that will increase your chances of seeing it in bookstores.

Starting a Business

A Founder Who Bootstrapped Her Jewelry Business with Just $1,000 Now Sees 7-Figure Revenue Because She Knew Something About Her Customers Nobody Else Did

Meg Strachan, founder and CEO of lab-grown jewelry company Dorsey, personally packed and shipped every order until she hit $1 million in sales.

Business News

I Live on a Cruise Ship for Half of the Year. Look Inside My 336-Square-Foot Cabin with Wraparound Balcony.

I live on a cruise ship with my husband, who works on it, for six months out of the year. Life at "home" can be tight. Here's what it's really like living on a cruise ship.