After a record-breaking capital raising year in 2021 for local startups, things seem to have slowed down in 2022.
That’s no surprise given the national trends and the lack of nine-figure fundraising figures that have marked years past in Buffalo.
Thirty-five area companies raised more than $530 million in 2021 – a feat that surpasses the region’s collective startup deal totals for the previous seven years.
In 2022, 32 companies based in or with strong ties to Buffalo raised $201.06 million.
The quantity of deals is still comparable to 2021, but there's a stark difference in the typical size of the deals. Take the two highest raises in 2022, for example, which were $40 million (Torch Labs) and $30 million (Centivo), according to Business First’s reporting. That’s significantly lower than the two highest raises in 2021: $135 million (Tackle.io) and $103 million (Jerry).
That’s perhaps a local reflection of an ongoing trend across North America of volatility in the high-growth technology scene, a result of factors like the war in Ukraine, inflation in the U.S. economy, and the government's response to it and the plunging stock market.
Although local investors have said effects would be felt the most by companies preparing to go public and large venture capital funds – which aren’t huge factors in Buffalo – they acknowledged there are still tangible concerns in Western New York. Those challenges range from investors pulling back amid an unstable market and rounds taking longer to close.
Business First has been closely counting startup deals in Buffalo for eight years now, focusing on raises that are $100,000 or higher. Typically, there are a few deals each year where terms and amounts are not disclosed, and the same rings true for 2022. (For those who did not disclose but gave an estimate, Business First added the lower end of the range to the 2022 total funding count.)
The goal is to be able to measure the ebbs and flows of Buffalo’s tech startup scene, a sector that’s been gaining momentum over the years.
The storm clouds don’t appear to be clearing in 2023. Heading into this new year, analysts expect venture capital fundraising in the U.S. to fall between $120 billion and $130 billion, far less than the $300+ billion invested in 2021, according to PitchBook's recent "2023 US Venture Capital Outlook" report.
Here are the Buffalo-area startups that raised funding in 2022:
- Torch Labs ($40 million)
- Centivo ($30 million)
- Circuit Clinical ($29 million)
- Kangarootime ($26 million)
- SparkCharge ($22 million)
- CleanFiber ($18.5 million)
- PostProcess Technologies ($5 million)
- VeriTX ($4.5 million)
- HELIXintel ($4 million)
- Blockfusion ($2.6 million)
- ShearShare ($2.3 million)
- Azuna ($3 million)
- Patient Pattern ($2 million)
- OneBridge Benefits ($2 million)
- BetterMynd ($1 million)
- CoachMePlus ($1 million)
- Empire Hemp Co. ($1 million)
- CaHill Tech ($1 million)
- Buffalo Film Works ($750,000)
- Garwood Medical Devices ($747,000)
- FavorDrop ($725,000)
- Wellconnected ($550,000)
- MemoryFox ($400,000)
- Ellicottville Greens ($300,000)
- Swift Rails ($255,000)
- AireXpert ($125,000)
- Arbol ($110,000)
- Lemma Labs ($100,000)
- Timberhut (undisclosed)
- Flox (undisclosed)
- Ognomy (undisclosed)
- Vicora/Ampullae (undisclosed)
Stay tuned for an article on local investors' takes on startup funding in 2023. Did we miss a funding announcement? If so, email lbunny@bizjournals.com to be included on the list.
Check out previous recaps from 2021, 2020, 2019, 2018, 2017, 2016, 2015 and 2014.
