VCs Chasing Consumer Tech

Venture capital investment in technology rose by $1 billion, but consumer-focused start-ups account for the increase--investments in enterprise technology remain flat. Analyst firm DataMonitor says VCs poured $6.89 billion into the technology market in the first half of 2006. That's compared with $$5.85 billion for the same period last year.

"There's been a dramatic amount of funding going into social networking Web sites and any type of service provider that can offer entertainment for mobile phone users," says Tom Jowitt, finance specialist at DataMonitor. He says the level of investment in enterprise technology hasn't changed in years. What's new: More VCs position start-ups for acquisition rather than an IPO. --Andrew Conry-Murray, [email protected]