All stages of venture capital investing took a hit in 2022 compared to 2021 amid wider economic strains.
According to the Q3 2022 PitchBook-NVCA Venture Monitor released in October, the nationwide median late-stage deal size in the third quarter was $10 million, down from $15 million in 2021. Angel investments and seed-stage funding also took hits, dropping from a total of $6.6 billion in Q3 2021 to $4.7 billion in Q3 2022.
In Houston, there were 22 VC deals totaling $267.26 million in the third quarter, a decrease of 12 deals but a 17.5% increase in total funding compared to Q2. However, Houston's Q3 VC investments were down from $520.84 million during the same quarter in 2021.
In Q3, Fervo Energy had the largest deal in Houston and the second-largest statewide, according to the Venture Monitor report, with $138 million in new funding as of Aug. 22. The company develops geothermal energy projects in the West and internationally. Majority, a financial technology company serving migrant workers, raised $38 million in Series B funding in Q3, while hydrogen startup Utility Global raised $25 million in Series B capital.
Local companies with the two largest raises during Q2 2022 were Houston-based energy software startup ComboCurve and Houston-based genomics and molecular diagnostics company NuProbe Global, according to the second-quarter report. ComboCurve announced raising $50 million in Series B funding in April, and NuProbe Global announced raising $50 million in June.
More recently, microgrid energy company VoltaGrid LLC closed a $150 million equity raise from existing investors — including Canada Pension Plan Investment Board, Pilot Co., Longbow Capital and Walter Ventures — in October. The raise follows financial commitments the company closed in 2021, including a $73 million equity commitment.
Syzygy Plasmonics also capped off a strong 2022 with a $76 million Series C raise in November, its largest raise to date. In May, the chemical manufacturing technology company moved its headquarters to a 44,800-square-foot building off the Sam Houston Parkway in Pearland, the Houston Business Journal reported at the time. Syzygy also more than tripled its headcount from 26 to 87, exceeding previous goals to double its workforce set in 2021.
Another noteworthy raise recently was Medical Informatics Corp.'s $17 million Series B co-led by Catalio Capital Management and Intel Capital in November. The round also saw Jonathan Blankfein, a principal at Catalio, joining MIC’s board of directors. MIC, which saw investment from the Texas Medical Center in all of its funding rounds, also added funds from TGH Innoventures, the venture fund of Tampa General Hospital in Florida. MIC’s flagship product is Sickbay, which captures and processes health care data from biomedical devices attached to patients. The company was one of three Texas startups named to the Amazon Web Services Healthcare Accelerator program targeting early-stage companies.
