Massachusetts turned in another very strong quarter on venture capital fundraising in Q1, with local companies topping $1 billion in quarterly funding for the third time in four quarters, CB Insights reported Tuesday.
Bay State companies raised $1.37 billion in total across 93 deals.
Since we mainly focus on high-tech here at BostInno rather than biotech, it’s worth noting that Q4 also saw a good showing on the tech side:
• Companies in tech (i.e. Internet, mobile, other software, hardware and electronics) accounted for 58 percent of the state’s total funding—or $795 million.
• That’s compared to 46 percent of funding overall in 2014.
The four largest deals during the quarter were also in tech—led by the $175 million round for data center management tech company SimpliVity, at a valuation north of $1 billion. The other three were networking technology firm Altiostar Networks ($70 million), CAD software firm Onshape ($64 million) and virtualization management tech firm VMTurbo ($50 million).
Meanwhile, CB Insights noted that Massachusetts made a stronger showing in the national mix of VC deals and funding in Q1 than in recent quarters. The state took 12 percent of deals in Q1, surpassing New York (11 percent) for the first time in at least five quarters:
On funding, Massachusetts also surpassed New York for the first time in a while, with $1.37 billion compared to New York’s $1.33 billion (percentage-wise, it comes out the same as part of the national mix):
It’ll be interesting, of course, to see whether this is a trend or a one-quarter phenomenon.
One reason that Massachusetts is looking especially good nationally, however, is that California has seen its share of both deals and funding drop in recent quarters. As CB Insights wrote in its report, “California saw its third straight quarter of decreased deal activity, dropping to its lowest point since Q1’12. Dollars also decreased by 17% in the absence of any $1B+ financings.”
Cities vs. suburbs
Geographically, Boston and Cambridge heavily dominated during Q1:
• Boston-based companies closed 33 deals totaling $347 million during the quarter
• Cambridge-based companies raised $425 million across 27 deals
• Waltham, Newton, Natick, Marlborough, Watertown, and Concord closed a total of 13 deals during Q1, worth $167 million—though if you add in the deal for Westborough-based SimpliVity, that figure would jump to $342 million.
