Chicago, November 13, 2008 – Venture capital investment in Illinois jumped to the highest level of the year in the third quarter, bucking the trend in private equity investments for the nation as a whole. A total of 23 companies in Illinois attracted $149.3 million in the third quarter, surpassing the second quarter pace of $138.2 million, according to the Illinois Venture Capital Association based on data provided by Thomson Reuters’ VentureXpert. The third-quarter sum was also above the five-year quarterly average of $141.4 million. Investment for the period was slightly below the same period a year ago, which totaled $167.2 million. In contrast, nationwide venture capital investments fell by half to $10.5 billion from $23.9 billion in the prior quarter.

"Despite the current state of the credit and equity markets, entrepreneurs in the Midwest are building businesses that are attractive to venture capital firms" says Benedict Rocchio of Baird Venture Partners. "Heading into 2009, we are cautiously optimistic. This environment should provide unique opportunities to invest in quality companies at attractive prices, and venture firms with capital on hand will be in a good position to act."

Illinois moved up a slot to 13^th place in its ranking nationwide for funds invested in the last quarter versus the second quarter. California companies raised the most capital, with 508 companies receiving $4.5 billion. For the first three quarters, Illinois ranked 17^th among the states with a total of $377.7 million in venture capital investments.

The Information Technology sector again attracted the most investment in the state, although only 8 companies received at total of $84.5 million compared to investments of $124.5 million in 10 companies in the second quarter. Investment in healthcare and other industries, however, jumped sharply, with healthcare totaling $43 million compared to $6.8 million in the second quarter, and other industries rising to $21.8 million from $6.8 million in the prior quarter. There was a venture capital investment in one Illinois “green” company in the third quarter while Illinois venture capital firms invested a total of $31.2 million in U.S. green companies.

Buyout capital investment in Illinois companies also rose to its highest level of the year in the third quarter, totaling $418.8 million for 13 companies. The buyout capital total was the highest of the last five quarters, more than double the year ago quarterly pace of $181.2 million and above the five-year quarterly average of $278.6 million. The trend matched the national course in buyout capital, which also set its highest pace in the third quarter at $15.3 billion.

Nationwide, Illinois companies ranked 8^th for the amount of buyout capital raised in last quarter, with California topping the list at $3.2 billion. For the first three quarters, Illinois ranked 13^th in the country with $760.4 million in buyout investments.