It's feast or famine for startups in Silicon Valley. In the second-quarter, investors plowed over $15 billion into venture-capital-backed startups, and that outpaces all but three-quarters since the 2000 Dot-com boom. Reuters Heather Somerville.>> Going into the fourth-quarter last year all the way up to the beginning of this year, there was a noticeable slow down in venture investing.
That was widely expected to continue and perhaps even worsen. But what we saw was a rebound of 20%.>> But not all startups are equal. Even as total funding was up sharply, the number of deals was down by about 5% from the first-quarter. Investors are being selective, after a rash of startups that had received huge funding rounds over the last year, failed to reach growth targets or proved to be unsustainable businesses.
Mutual funds and sovereign wealth funds still driving the big deals. Uber got $3.5 billion from the Saudi Arabia's public investment fund, making it the biggest steal of the quarter and Snapchat got 1.3 billion from investors including Fidelity.>> Another reason is improvements in the stock market have help investors get their confidence back.
Valuations are coming down, so more deals are to be had, so investors are getting really active trying to scoop up companies that have lower devaluations by 30 or 50%.>> So what are those with money look for? Software is what they seem to be chasing. Over half of the second-quarter investments were in software startups, up 70% from the first-quarter.