The investment drought for technology start-ups could be over after a resurgence of initial public offerings (IPOs) backed by venture capital (VC) firms late last year. Figures from the United States-based National Venture Capital Association (NVCA) show venture capital-backed IPOs made a comeback in the fourth quarter of last year, suggesting the long investment winter for technology start-ups may be coming to an end. NVCA found that venture capital-backed companies raised US$1.45 billion on US markets in the fourth quarter, compared with US$230 million in the third quarter and US$2.23 billion in the fourth quarter of 2000. Most of the 24 venture capital-funded companies which went public in the fourth quarter were in the medical and health fields, NVCA said. According to NVCA, 1999 and 2000 were record-breaking years for the industry, based on the amounts invested in start-ups and funds raised from stock markets. But last year investors withdrew, leaving many promising technology companies to fend for themselves. NVCA said 5,458 companies received a total of US$103.8 billion in 2000, while 2,729 companies received just US$31 billion last year. Silicon Valley's share of venture capital investment fell from US$21 billion in 2000 to US$6 billion last year. Silicon Valley-based Tahoe Networks recently received US$10 million from Redpoint Ventures and Accel Ventures to support pre-production tests on data routing equipment with mobile operators in Asia. Singapore's DenseLight has received a total of US$30 million over the past 15 months from 3i, a London-based venture capital firm that has a US$400 million fund dedicated to technology investments in Asia. Tahoe Networks chief executive Anthony Alles said venture capitalists had returned, but they were much more cautious now. 'The industry works on some fairly rigorous financial models and over the last bubble period people said, 'the old rules don't apply, returns are going to be exorbitantly large so it makes no difference how we fund those companies'. What they're now finding is returns are back to historical norms.' Many companies that were funded over the two-year bubble period had closed because of a lack of money from their investors, Mr Alles said. But investors were back and looking to invest at more realistic valuations, he added. 'So basically, if you could wipe out that bubble, wipe out the companies in that bubble and you start again, that's pretty much where the VC industry is now, which is better than where they were last year. Last year, they were running for the hills.' Tahoe Networks, which makes equipment for connecting mobile networks to Internet servers, said it would conduct tests with several unnamed mobile providers in the Asia region this year.