(RTTNews) -  Industry tracker Dow Jones VentureSource (NWS: News ,NWSA: News ) said Saturday that the U.S. venture capital industry declined in the second quarter, but showed signs of recovery after a sizable decline in the first quarter of 2009.

Venture capitalists invested $5.27 billion in 595 deals in the second quarter, a 32% improvement over the first quarter of 2009. However, it was lower than the $8.33 billion put into 726 deals during the second quarter of last year.

According to VentureSource, the Health Care industry saw $2.23 billion invested in 184 deals completed in the second quarter of 2009, a 14% decline from $2.60 billion last year. By sector, biopharmaceutical investment slipped 14% to $1.22 billion put into 71 deals from $1.42 billion in 85 deals in the second quarter of 2008. Investment in medical device companies fell 26% from the $1.04 billion put into 77 deals last year to $766 million invested in 79 deals in the most recent quarter.

VentureSource also said that investment in the Information Technology industry remained at lows unseen since before the tech boom of the late nineties. In the second quarter, IT investment was $1.88 billion compared with $3.21 billion invested in 338 IT deals a year ago.

The Energy & Utilities industry garnered $317 million in 29 deals during the second quarter, down 70% from the $1.07 billion it saw invested in 37 deals last year. Investment in the renewable energy sector also fell 75% to just $221 million invested in 16 deals from the $897 million invested in 30 similar deals in the same quarter last year.
The Business and Financial Services industry attracted $547 million in 69 venture deals during the recent quarter, down 38% from the $881 million invested in 93 deals last year.

Further, the Consumer Services industry saw $80 million put into 22 deals in the second quarter, down 65% compared to a year ago. The Consumer Goods industry attracted $96 million in venture capital while the Industrial Goods & Materials industry garnered $86 million, VentureSource stated.

The data also showed that the median deal size fell to $5 million from the $8-million median seen a year ago. Later-stage financing rounds accounted for 53% of all venture investment in the second quarter, up from 51% in the same quarter last year.

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by RTT Staff Writer

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