U.S. companies find venture capital harder to find

U.S. companies that rely on venture capital investment to expand their businesses and hire employees have struggled to raise money this year, new data show.

The trend came to light in a pair of recent quarterly venture capital reports that used different data to arrive at the same conclusion: Investors aren’t pouring as much money into young companies as they were this time last year according to a published report in The Washington Post.

The impending presidential election is likely weighing on some investors, industry insiders say, particularly because the outcome of the race could lead to higher tax rates on these types of investments.

Analysts are quick to caution that a single quarter does not make a trend. That’s true. But investments are down for the first nine months of the year overall, making it unlikely that 2012 will post end-of-year results that are the same as or better than 2011.

The recession brought venture capital investments to their lowest point in a decade as investors hit the breaks on new deals, using their money instead to keep existing businesses afloat. >>More here