Updated Feb. 17, 2017 at 7:58 a.m.

Report: NC equity funding drops $400M in '16 yet reach grows

Published: 2017-02-16 09:46:00
Updated: 2017-02-17 07:58:59


North Carolina entrepreneurial companies raised far less money in equity funding last year than in 2015, according to a new report from the Council for Entrepreneurial Development.

However, the more than $800 million raised is still higher than figures for 2013 and 2014.

Plus, the CED reports that North Carolina firm are drawing more interest from the globe's VC hub (Silicon Valley) as well as other regions.

"Analysis of institutional investor geography signaled good news for North Carolina entrepreneurs as investors from California (27) and international locations (18 investors) participated in deals at the highest level since CED began tracking data in 2013," the CED notes.

Also, it should be noted that 2015 was a banner year for the state and across the country for deal makers with North Carolina firms landing some $1.25 billion as reported last May.

Deals across multiple sectors in 2016 totaled 188 investments in 154 companies, according to the CED.

Unlike other reports that focus on venture capital, the CED report also includes angel, corporate, growth equity and what the CED calls "strategic investments."

“North Carolina continues to post sizable funding totals due to the quality of entrepreneurial companies throughout the state, a diversity of investable sectors, and good valuations paired with a solid record of exits,” said CED Vice President of Investor Relations Miriam Wilson in announcing the latest totals.

Putting a positive spin on the data, she added: “While funding and deals dipped in 2016, the totals far outstripped those of 2014 and 2013.”

2014 produced $622 million deals.

2014 netted $461 million.

The CED also points out that a lack of big deals helped drive down the funding total. In 2015, deals above $50 million accounted for $425 million.

A $71 million deal for Phononic last year was the 2016 highlight.

Inside the numbers

By category, the deal breakdown:

  • Tech: 75 companies completed 86 deals, resulting in over $235 million
  • Life Science: 58 companies completed 77 deals, netting more than $463 million
  • Advanced Manufacturing and Materials: 16 companies completed 20 deals, bringing in over $90 million
  • Cleantech: 5 companies completed 5 deals, raising more than $16 million

Where investors were from:

  • North Carolina, 33
  • California, 27
  • New York, 14
  • Massachusetts, 10
  • 18 international (Belgium, Canada, China, Ireland, Israel, Japan, the United Arab Emirates, and the United Kingdom, China)
  • China had the most deals at 8

The IPOs

CED noted two initial public offerings:

  • Novan
  • Patheom

And 38 M&A. The largest:

  • Sensus, acquired by Xylem for $1.7 billion
  • Biologics, Inc., acquired by McKesson Specialty Health for $1.2 billion
  • Bamboo Therapeutics, acquired by Pfizer for $645 million
  • ESP/SurgeX, acquired by AMETEK for $130 million

Read more at:

http://www.cednc.org/innovatorsreport

Previous CED reports:

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