According to Patty Tascarella of the Pittsburgh Business Times, US corporate venture investment is at its highest level since 2002.

In the second quarter of 2006, corporate venture capital investment reached its highest level since the first quarter of 2002, according to a new report by PricewaterhouseCoopers and the National Venture Capital Association based on Thomson Financial data.

Corporate venture capital is defined as operating corporations investing directly in portfolio companies, either on a sole basis or alongside traditional, independent venture capital funds. These corporate entities are in some cases referred to as strategic investors.

During the three months ended June 30, 2006, corporate venture capital groups participated in 195 deals or 22.2 percent of all venture capital deals completed. These deals represented $602.5 million or 9.2 percent of all dollars that venture capitalists invested in the quarter.

I wonder how Canadian companies compare. Are our corporate treasuries as healthy and are they willing to take five to seven year risks ?

"The uptick in corporate venture capital activity suggests that large companies are currently in a position to look to the future and take some risks as it relates to new technologies," Mark Heesen, NVCA president, said in a statement. "The overall commitment to venture capital investment by corporations has ebbed and flowed over time. It is always a tug-of-war between short term earnings pressures and long term product vision. For many companies, it is often difficult to stay the course of investment, which could last 7 to 15 years."

Even if Canadian companies are in the position to increase venture investment, from a street perspective local start-ups remain overlooked.