It may come as no surprise, but attracting the eye of a venture capital firm is a lot tougher during a recession. VC investments hit a 12-year low during the first quarter of 2009 with only 549 deals struck, according to the PricewaterhouseCoopers/National Venture Capital Association MoneyTree Report.

That’s roughly half the number of deals done during the same period in 2008.

VC’s invested only $3.08 billion during the first quarter, with double digit declines in virtually every major industry sector.

Financial services was the only sector to see any increase in dollars or deals. The Software sector dropped 42 percent in dollars versus the fourth quarter of 2008, despite receiving the highest level of funding with $614 million. Deals were down 34 percent.

The Life Sciences sector (Biotechnology and Medical Devices combined) experienced a 40 percent decline in terms of dollars and a 31 percent drop in deals. The Clean Tech sector (alternative energy, pollution and recycling, power supplies and conservation) saw an 84 percent decline from the fourth quarter of 2008. That was the lowest investment level for the Clean Tech sector since 2005.

Other industry sectors that experienced significant investment dollar declines in Q1 2009 included: Telecommunications (down 72 percent), Media and Entertainment (chalking up a 45 percent decline) and Networking and Equipment (with a 47 percent decline).

The MoneyTree Report is a joint research report reviewing current venture capital funding. It’s issued quarterly by PricewaterhouseCoopers (PwC), the National Venture Capital Association (NVCA) and Thomson Reuters.

Details of the quarter’s 10 largest investments and a historical look at investments from 1995 forward are attached in the Excel sheets below.

We’ll have the second quarter numbers available to download in mid-July.

Q12009 Top Deals

Q12009 MoneyTree Report