D.C. area companies raised about $1.91 billion in 2019, spanning 246 venture capital deals, according to PitchBook and the National Venture Capital Association's annual "Venture Monitor" report.
Washington's showing comes as slightly more modest than 2018, which had 258 deals totaling a record-breaking $1.97 billion for the region. For D.C., that’s about a 3 percent drop, roughly aligning with a national decline of about 2.6 percent. The national figure for 2019 was $136.5 billion across 10,777 deals.
It’s a definite dip, but PitchBook and the NVCA didn’t frame it as a loss, instead saying that it marks the second straight year that that investment deals in U.S. companies went above $130 billion. For D.C., 2019 is the second highest year since 2006 (when the report’s data starts). VC funding in D.C. peaked in 2018, and it has been above $1.3 billion since 2013.
“2019 showed that industry trends from the historic 2018 are the new normal for the venture industry, with mega-rounds and mega-funds becoming increasingly common trends in the startup ecosystem,” said Bobby Franklin, President and CEO of the NVCA, in a statement.
The report notes a strong showing of “mega-deals” totaling more than $100 million, 25 percent of which were for early stage companies. Interestingly, the report’s data doesn’t include any DMV deals, although the region did have some. That may be due to the report’s narrow focus on venture capital deals, as opposed to debt financing and other investment types.
The Washington region did have a few mega-deals. Columbia, Md.’s BioEnergy DevCo landed a $106 million private equity deal from Newlight Partners, and D.C.-based MPOWER Financing got $100 million in debt financing from Goldman Sachs. Additionally Silver Spring’s CuriosityStream raked in $140 million in VC funding, but that may have not been included in the report because the deal was officially filed in 2018, but announced in early 2019.
“Despite uncertainties about the sustainability of the unprecedented activity seen in 2018, this year kept pace and will undoubtedly leave its mark on the venture ecosystem,” said John Gabbert, founder and CEO of PitchBook, in a statement. “The continued proliferation of nontraditional investors participating in VC and the need for LPs to recycle distributed capital back into new VC funds should keep venture momentum strong heading into 2020.”
In the last quarter of 2019, the top 10 deals in the Washington metropolitan statistical area, which for the PitchBook NVCA report includes firms in D.C., Virgina, Maryland and West Virginia, take up a sizeable chunk of the pie at $334 million. Here are the top 10 deals according to the report:
- Arcellx – $85 million
- ionQ – $55 million
- Holistic Industries – $55 million
- Cava – $40 million
- Arcadia – $30 million
- WhyHotel – $20 million
- Cybrary – $15 million
- Play Octopus – $13 million
- Origin Wireless – $11 million
- Stori Card – $10 million
In addition, the report notes the top three exits for the D.C. area in Q4.
- Viela Bio – The Gaithersburg, Md.-based biotech firm went public in October when it was valued $794 million, according to the report.
- Endgame – Dutch company Elastic bought the Arlington-based endpoint cybersecurity company for $234 million in October.
- VividCortex – This Charlottesville, Va. database monitoring company was acquired by SolarWinds in December for $117.5 million
National Trends
U.S.-based companies raised about $136.5 billion across more than 10,700 deals in 2019, PitchBook reported.
Last year’s VC activity was slightly lower than 2018, when U.S. companies raised $140 billion across 10,500 deals. The dip was due to a slower fourth quarter, PitchBook says. But overall, the shows that venture capital raised by U.S. companies has been steadily rising since 2006.
California startups saw the most funding of any state, with companies raising more than $63 billion across 3,623 deals. The state had several multi-million-dollar deals from San Francisco companies such as DoorDash, which raised $700 million last year, and Databricks, which raised $400 million in October.
Following California was New York, whose startups raised more than $27 billion across 1,315 deals, and Massachusetts, which saw more than $10 billion raised in 2019 across 740 deals.
When it came to startup exits, 2019 hit a new record for U.S. VC exit value, coming in at $256.4 billion across 882 liquidity events. One of the year’s largest exits was Honey, which was acquired for $4 billion by PayPal in November.
Female-founded companies saw record activity on both a capital and deal count basis, raising $18 billion across 2,184 deals in 2019, compared to nearly $17 billion across 2,057 deals in 2018.
Chicago Inno’s Katherine Davis contributed to this report.
