Venture capitalists invested $6.5 billion in 906 deals across the country during the second quarter of 2010, the highest dollar amount since $7 billion was invested in the third quarter of 2008, according to the MoneyTree Report released Friday. For the first half of the year, venture capital (VC) investments totaled $11.4 billion going into 1,646 deals, a 49 percent increase in dollars and a 23 percent increase in transactions from the first half of 2009 when $7.7 billion was invested in 1,340 deals.
The MoneyTree Report is provided quarterly by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters.
Dollars invested in the clean technology sector doubled in the second quarter compared to Q1 of 2010, and at $1.5 billion broke the quarterly record for the sector. The life sciences sector, which combines the biotechnology and medical device industries, jumped 52 percent in dollars and 36 percent in deals from the prior quarter with $2.1 billion going into 234 deals. Seed and early stage deals also increased notably in Q2 from prior quarters, accounting for a greater percentage of total deals.
“As the exit market begins to show signs of life, venture capitalists are now able to look increasingly at new investments outside their existing portfolio, NVCA President Mark Heesen said in a statement. “This dynamic translates into momentum in the seed and early stage sectors where valuations remain reasonable and opportunities are great. Investment in the clean technology and life sciences sectors, which are generally longer term and more capital intensive in nature, are balanced by smaller deals within the information technology sectors creating a diversity of opportunities for success for entrepreneurs, VCs and limited partners alike.”
Pittsburgh activity mirrored the national trend, as $84.5 million was pumped into 19 companies, the highest dollar level in four years. Recipients spanned several sectors led by life sciences.
“Life sciences tend to show up in venture statistics maybe a little more because those deals tend to need larger infusions of capital,” said Innovation Works Chief Investment Officer Matt Harbaugh. “We’re seeing a surge in the number of Internet and software companies in the region, but they may be more capital-efficient and may not need to raise money.”
Investors included local venture capital and economic development entities, large venture capitalists from the west coast, Boston and London. Some were newcomers to the region, some were repeat investors. John Taylor, NVCA research and financial affairs executive, said the mix of investors in the Pittsburgh deals, bodes well for the region.
“That’s a hallmark of a healthy ecosystem,” Taylor said.
For more on second quarter capital raised by Pittsburgh companies, see the July 16 print edition of the Pittsburgh Business Times.
Three deals accounted for $77.82 million or 21 percent of the $84.51 million invested in Pittsburgh companies during the quarter ended June 30, 2010.
- Company: Precision Therapeutics
- Money raised: $35 million
- Investors: Adams Capital Management, Bain Capital Ventures, Birchmere Ventures, Draper Triangle Ventures, Hillman Co., Longitude Capital Management Co., Quaker BioVentures, TVM Capital
- Company: Netronome Systems
- Money raised: $23 million
- Investors: DFJ Esprit, Top Technology Ventures Ltd. Tudor Ventures*
- Company: ModCloth Inc.
- Money raised: $19.82 million
- Investors: Accel Partners, First Round Capital, Floodgate Fund*
- Company: Cernostics Inc.
- Money raised: $2.62 million
- Investors: Novitas Capital, Pittsburgh Life Sciences Greenhouse*
- Company: Foundation Radiology Group
- Money raised: $1.5 million
- Investors: Chrysalis Ventures, Health Evolution Partners LLC*
- Company: Celsense Inc.
- Money raised: $680,000
- Investors: Pittsburgh Life Sciences Greenhouse
- Company: ATRP Solutions
- Money raised: $380,000
- Investors: Innovation Works*
- Company: Appalachian Lighting Systems
- Money raised: $300,000
- Investors: Innovation Works
- Company: Industry Weapon Inc.
- Money raised: $290,000
- Investors: Innovation Works, Pittsburgh Equity Partners*
- Company: AllFacilities Energy Group
- Money raised: $200,000
- Investors: Innovation Works
- Company: Deeplocal Inc.
- Money raised: $170,000
- Investors: Innovation Works
- Company:American Roadprinting LLC
- Money raised: $150,000
- Investors: Innovation Works
- Company: NeuroInterventional Therapeutics
- Money raised: $100,000
- Investors: Innovation Works
- Company: Health Monitoring Systems Inc.
- Money raised: $100,000
- Investors: Innovation Works
- Company: Bueda Inc.
- Money raised: $100,000
- Investors:Innovation Works
- Company: Fooala Inc.
- Money raised: $50,000
- Investors:Innovation Works
- Company: Synesi LLC
- Money raised: $30,000
- Investors: Innovation Works
- Company: FastTAC Inc.
- Money raised: $30,000
- Investors: Innovation Works
- Company:Landslide Technologies
- Money raised: N/A
- Investors:Osage Partners LLC
*Round included unidentified investor or investors
Source: MoneyTree Report by PricewaterhouseCoopers and the National Venture Capital Association based on Thomson Reuters data
Senior reporter Patty Tascarella covers banking, finance, legal, marketing and advertising and foundations for the Pittsburgh Business Times.
Contact her at ptascarella@bizjournals.com or (412) 208-3832.