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Venture capitalists poured a record $138 billion into U.S. startups last year, the most since 2000.

“AI, big data, cloud, autonomous vehicles, health care, blockchain, security–the list is as long as I’ve ever seen of investible themes, and we see a high degree of activity in anticipation of the IPO unicorn class of 2019,” Jeff Grabow, U.S. Venture Capital Leader of Ernst & Young, tells Barron’s in a phone interview.

Information technology raised nearly 20% of all capital in the fourth quarter, behind categories for consumer goods (nearly 30%) and business-financial services (almost 25%), according to Crunchbase.

That’s the good news.

And yet, the huge cash infusion–$47.1 billion in the fourth quarter, a 43% hike from the previous quarter–shares some echoes with the VC climate in 2000, shortly before the infamous dot-com crash. Investors, Grabow and others say, are jittery and making their bets on a strong IPO class that could include Uber, Lyft, Slack, and others before a possible recession or more bad economic news from China.

“We’re in a cash bubble, with money looking to be placed to find yield,” Grabow says, noting that corporations and private-equity investors accounted for 40% of the dollars raised in the fourth quarter. “This hot market pace won’t sustain. It is healthy to pull back on investments.”

Feature Image Credit: Photograph by Keystone/Hulton Archive/Getty Images

By Jon Swartz

Sourced from Barron’s