Venture-backed firms thrive

SAN FRANCISCO -- While venture capitalists retrenched, many of the companies they helped create expanded during the past three years of economic turmoil, according to a study released yesterday.

Venture-backed firms created 600,000 jobs nationwide from January 2001 through December 2003, a net gain of 6.5 percent, said Global Insights, a research firm that conducted the study for the National Venture Capital Association, an industry trade group.

Revenue among the venture-backed companies climbed $212 billion, or 11.6 percent, during those three years, the study found.

The venture-backed growth contrasted with a 2.3 percent payroll decline that wiped out 2.6 million jobs during the same period.

Meanwhile, total sales at all US companies surged by $1.1 trillion, or 6.5 percent.

At the end of 2003, venture-backed companies employed 10.1 million workers and generated combined revenue of $1.8 trillion -- just under 10 percent of the national total in the private sector.

The study drew upon a database of nearly 26,500 companies financed by venture capitalists since 1970.