Venture capital deals are up nationwide for the second quarter of 2024, and Minnesota startups are keeping pace with their biggest quarterly haul in more than a year.
Startups raised $505 million through 34 deals this quarter, compared to $406 million through 44 deals in 2023, according to the most recent Pitchbook-NVCA Venture Monitor report.
So far, startups have raised a collective $725 million in 2024. That's up by about $125 million compared to the total funding raised in the first half of 2023. This year, medtech and pharmaceutical companies led the way for Minnesota venture capital deals, although no major exits have occurred.
Biggest Minnesota VC deals of Q2:
Medtech company Endogenex closed the largest deal of this quarter. The Plymouth-based company, founded in partnership with Mayo Clinic, raised $88 million in a Series C funding round to develop a treatment for Type 2 diabetes. The funds will be used for clinical trials of Endogenex's ReCET System. The trial will enroll more than 350 patients in the U.S. and Australia.
Nucleus RadioPharma received in June an undisclosed investment in an extension round from AstraZeneca (Nasdaq: AZN), a global biopharmaceutical company. The Rochester, Minnesota-based company is another Mayo Clinic progeny launched with Silicon Valley venture capital firm Eclipse two years ago. Nucleus RadioPharma develops, manufactures and distributes radiopharmaceuticals — drugs containing radioactive materials — for cancer treatment.
Elucent Medical, a medtech company developing a means of targeting tumors during cancer surgery, raised $42.5 million in a Series C funding round in April. The Eden Prairie-based company will use the funding for the development and commercialization of its EnVisio and SmartClip technologies used in tissue-sparing cancer surgeries.
IVEAcare closed on a $27.5 million funding round at the end of April. The Roseville-based company also appointed Todd Kerkow as its new CEO and president closing the round. The medtech company focuses on neuromodulation therapy, which sends targeted electrical impulses to specific areas of the body to treat nervous system problems.
Software company Nexben raised a total of $24.1 million in a funding round, according to data from Pitchbook-NVCA's most recent Venture Monitor report. The company develops a cloud-based health insurance benefits platform.
The largest deal so far in 2024 remains the $90 million round for Niron Magnetics that was reported to the Securities and Exchange Commission in January at $86 million and amended in March. The Minneapolis-based startup's round is still the largest deal in more than a year.
National venture trends
Nationally, venture capital deal activity rose to $55.6 billion across 3,108 deals in the second quarter, marking the greatest quarterly total since the second quarter of 2022, when funding reached $77.6 billion.
Inflation, elevated interest rates and economic uncertainty continue to dampen venture capital deals globally, but the U.S. is showing positive signs of dealmaking activity in the second quarter, according to initial data from PitchBook and NVCA.
While there’s been an uptick in second quarter dealmaking activity, it may be too early to claim a rebound from the pandemic funding frenzy, according to PitchBook.
The flood of investment in early-stage blockchain, autonomous vehicles, virtual reality and artificial intelligence-related startups has largely abated, and now VC firms are focused on supporting their most promising companies amid a challenging exit environment.
Amy Edelen from AZ Inno, Alex Zorn of Chicago Inno, and David Schuyler of Wisconsin Inno contributed to this article.
