Yep, that’s right — the companies attracting investment capital are technology companies that help businesses be more efficient. It seems as though the shine has worn off the new, hip, consumer internet startup and capital is shifting to enterprise technology companies. This isn’t exactly a new investment strategy — companies have long been the source for large technology budgets…so makes sense that investment in companies who sell to businesses do well.
The surge in investment dollars is actually accompanied by a slowdown in commitments to new technology companies, indicating that investors’ confidence in the sector’s strength is matched by a belief that this current crop of business technology companies is maturing. In the second quarter of 2013, investors backed 328 startups in the enterprise software category, by the second quarter of 2014 that number had declined to 205.