7/30/2019 Funding Startups In Texas
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LOCAL ECONOMIC SNAPSHOT | VENTURE CAPITAL
By HANAH CHOStaff Writer
[email protected]
Venture capital is falling this year after roaring back last
year. For the first nine months of the year, venture
capitalistsinvested less money in startups and young companies in
the Dallas area and in Texas than during the same period last
year.
On that pace, funding in 2012 will fall below investments in
2011, a trend that is also reflected nationally.
The bottom line
John Taylor, head of research at the
National Venture Capital Association
Joel Fontenot, a managing partner
of Trailblazer Capital
Hanah Cho, staff writer,
The Dallas Morning News
Were seeing considerable softening
of new investment in life sciences. The
number of first-time fundings in
biotech and medical devices is much
lower than it has been even in recent
years. A lot of that is
caution about the
future of the FDA
[Food and Drug
Administration].
With entrepreneurs lamenting the
lack of venture capital, itll be
interesting to see how the
Securities and Exchange
Commissions new crowd-funding
rules expected next
year will impact
how startups
raise funds.
Trailblazer Capital has seen a large
increase in new ventures requesting
startup capital of $1 million to $3 million.
Our Fund II investments are experiencing
receptive markets with financially strong
companies willing to take
new product risk. We
believe this will result in
robust early-stage
company growth and
investment activity in
2013.
Funding for Texas startups dips
SOURCES: PricewaterhouseCoopers; National Venture Capital
Association; MoneyTree Report; Data from Thomson Reuters
Venture capital investments in TexasFunding came back in 2011
after a three-year slump amid an economic
downturn. Flow of money into young Texas companies in 2012 has
slowed again.
Top 10 industry investments statewideSo far this year, the
Austin-based software company
Drillinginfos nearly $117 million deal has been the largest
in
the state. Software garnered the most money locally,
statewide and nationally. In North Texas, biotechnology and
information technology took the next two spots. Companies
in Dallas attracted about $83 million in investments, coming
behind Austin and Houston so far this year.
Top 5 deals in North TexasSoftware companies make up the bulk of
the top deals,
but biotechnology got a rare lift to the top.
Venture capitalfundraising
Fundraising dollars this year appear
to be on track to beat last years
commitments, but the number of new
funds has declined. In the first nine
months of 2012, 139 funds raised $16.2billion vs. 160 funds and
$12.4 billion
for the same period in 2011. In the
Dallas area, only one raised capital:
Pharos Capital Group of Dallas.
0
250
500
750
1,000
1,250
1,500
1,750
2,000
2009
2010
2011
2012*
163
173
182
139
$16.3
$13.6
$18.6
$16.2
YEAR FUNDSAMOUNT(In billions)
(in millions)
03 04 05 06 07 08 09 10 11 12*
*Through nine months
Industry Amount invested
Software
Medical devices and equip.
Industrial/energy
Biotechnology
Semiconductors
IT services
Computers and peripherals
Electronics/instrumentation
Media and entertainment
Health care services
$281.02
$91.78
$83.10
$63.32
$54.98
$42.01
$35.88
$17.56
$17.48
$13.89
(In millions)
Texas: $716 million
North
Texas:
$82.9
million
Texas North Texas
Neos
Therapeutics Inc.
Grand Prairie
Biotechnology
$18.1 million
Horizon Data
Center SolutionsPlano
Software
$13 million
SCIenergy
Dallas
Software$6.2 million
SCIenergy
DallasSoftware
$8 million
DeviceFidelity Inc.
Richardson
IT Services$6 million
