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Venture Investing Just Had Its Biggest Q1 in 15 Years, Says PwC Report

Re/code: Venture capital investing just had its biggest Q1 in 15 years, according to new data on VC investment trends.

At $13.4 billion in 1,020 deals, the first fiscal quarter of 2015 clocked in the most first-quarter funding since 2000. Investors threw 26 percent more money into deals than they did in the first quarter of 2014. If you needed any more proof the market is on the upswing, this is it. The numbers come from the MoneyTree Report produced quarterly by PricewaterhouseCoopers and the National Venture Capital Association, using data provided by Thomson Reuters.

There was a host of other findings, most of which showed that the billions of dollars being poured into startups are still flowing freely. There were twelve deals that passed the $100 million threshold. Later-stage deals represented a third of the total money invested. The funding software companies received compared to startups in other sectors has doubled in the last decade, from 21 percent in the first quarter of 2006 to 42 percent in the first quarter of 2015. The second-biggest sector for deals was biotechnology, with $1.7 billion going into 124 deals.

“This is a good time to raise money, even if you don’t need the money,” Gary Little, a partner at Canvas Venture Fund, told Re/code in an interview.

The report is particularly timely given news today that enterprise chatting app Slack has just raised another $160 million. Founder Stewart Butterfield admitted that he hasn’t spent any of the money he raised in the Series D back in October. So why shore up with an even bigger Series E?

He’s putting the money away as a cushion for Slack in case the market shifts. “It’s [also] for having the flexibility to pursue big opportunities: Acquisitions, advertising, international expansion,” Butterfield told Re/code.

That’s exactly the kind of thinking that Little is promoting after seeing the latest venture investment numbers. “I don’t see anything on the horizon that will cause a downturn but we know it will happen,” Little said. “Raise the money, but don’t spend it all.”

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