Venture capital funding for start-ups dropped nationwide and in Massachusetts last year as investors shied away from backing biotechnology companies, traditionally a bright spot for investment in New England.

Overall spending for New England fell to $3.2 billion, a 3.3 percent ­decline compared with 2011, and ­declined 10 percent nationwide, to $26.5 billion, according to the quarterly Money Tree Report by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thompson Reuters.