Venture capitalists plowed $5.9 billion into startups in the first quarter of 2012, a 22% drop from the previous quarter and the lowest level of VC funding since Q2 2010, according to a researcher tracking the market.
However, that shortfall is not necessarily a worrying sign since Facebook’s recent $1 billion acquisition of Instagram may fuel a flurry of new activity, according to the researcher, CB Insights.
CB Insights’s report found there were a lot of deals in Q1 — 785 investments, which was the second most in the past nine quarters. But the dollar amount of those investments was relatively low, which accounts for the drop.
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