Venture capital (VC) investment in China surged 87.4 percent to US$677 million in the third quarter, an industry report said.

Service-oriented sectors were the most appealing as they attracted a record US$432 million and accounted for nearly half of the 59 deals, according to a joint report by Ernst and Young and Dow Jones VentureOne, a financial information provider.

By comparison, the sectors received investments worth US$242 million in the same period last year.

Money flowing into the information industry dropped 23 percent from a year ago to US$217 million and accounted for 24 deals.

"Globally, more and more venture capitalists are pouring funds into service-oriented companies," said Robert Partridge, Managing Director of Transaction Advisory Services and the VC Advisory Group of Ernst and Young.

"These companies have a relatively low capital threshold for investors and can attract a large group of customers within a short time."

Venture capital, also known as risk capital, refers to money invested in start-up firms and small businesses that have both growth potential and the possibility of loss.

(Xinhua News Agency November 17, 2007)