Venture capitalists see promise after a tight year for US startups

INVESTORS who once poured money into America's startups with abandon began to tighten their belts this year. The amount of money that flowed into US startups fell in 2016 for the first time in four years as the number of deals struck tumbled to their lowest levels since 2011.

But the technology world has high hopes that 2017 will prove to be brighter, as the parent company of Snapchat and other high-fliers prepare to go public and venture capitalists amass huge new war chests. About US$67.8 billion was invested in startups in 2016, according to data from PitchBook, down 15 per cent from last year. And just 7,841 deals were struck, down 25 per cent from the period a year ago.

Much of 2016 proved to be a less ebullient time for the once red-hot startup market. In years past, investors and the industry press alike delighted in anointing new "unicorns", the once-ballyhooed term for a startup valued at more than US$1 billion.