Regional Venture Activity Kicks Off Summer With a Bang

RALEIGH … On this Memorial Day, maybe the entrepreneurial community and venture capitalists should take a minute to reflect on the casualties in the Southeast’s tech trenches.

Numerous once-promising start-ups like Cogent Neurosciences, Zoom Culture and Incanta fought the good fight but eventually died because of a lack of financing.

With that in mind, the region should give thanks that four … count ’em four, not the usual one or even two … venture deals were announced last week for a combined $15 million. Of course, also keep in mind that all four are based in the Research Triangle region, which means that Georgia’s shut-out streak stretches on another week, so there is a long way to go before the regional drought in venture activity is over.

But at least this week, the Southeast can be happy for network security firm CipherOptics, software developer HAHT Commerce and International IT Services, all of Raleigh, and Durham-based cheminformatics company Synthematix.

The Carolinas and Georgia now have posted to 41 deals for the year, totaling $258 million. That compares with more than $425 million in 56 deals at this point a year ago.

Here is LTW’s exclusive list, ranked according to the size of the deal, for the Carolinas and Georgia:

Company; Sector; Amount (Round)

Investors: Kohlberg Kravis Roberts, M/C Ventures, Quadrangle Group, Vaxa Corporate Partners and Wachovia Partners

2. TransTech Pharma, High Point, N.C.; Pharmaceutical; $24 million (2nd)

Investors: MacAndrews & Forbes (lead), Cephaton and Novo Nordisk A/S

3. Prenova, Marietta, Ga.; IT services; $15.5 million (3rd)

Investors Frontenac (lead) Austin Ventures and River Cities Capital Funds

4. Targacept, Winston-Salem, N.C.; Biotech; $14 million (2nd)

Investors: Nomura International Healthcare Private Equity Group (lead), Bison Capital, Cogene Biotech Ventures, JAFCO, Oxford Bioscience Partners and Rock Castle Ventures

5. STI Knowledge, Atlanta; Software; $14 million (1st)

Investors: Satish Sanan (individual lead) BV-Cornerstone Ventures and Mellon Ventures

6. TranS1, Wilmington, N.C.; Medical devices; $12 million (2nd)

Investors: Advanced Technology Ventures (lead), Cutlass Capital, Delphi Ventures and Sapient Capital

7. nuBridges, Atlanta; Software; $11 million (2nd)

Investors: hf Flagship Investments (lead), C&B Capital, GMT Capital, Noro-Moseley, Tycho and Marie Hawle Foundation and individuals

8. Arsenal Digital Solutions, Cary, N.C.; IT services; $10.5 million (4th)

Investors: Covestco, Southeast Interactive Technology Funds and Southern Cross Capital

9. Ephinay, Charlotte; Services; $10 million (1st)

Investors: Chrys Capital

10. StemCo Biomedical, Durham; Biotech; $9.8 million (2nd)

Investors: Aurora Funds (co-lead), Intersouth Partners (co-lead), BD Ventures, Tall Oaks Capital and Trelys Venture Partners

11. CipherOptics, Raleigh; IT services; $9.6 million (2nd)

Investors: Kodiak Venture Partners (lead), Axiom Venture Partners, New Tampa Technologies and Origin Partners

12. Venetica, Charlotte; Software; $7 million (1st)

Investors: Charles River Ventures and General Catalyst Partners

13. Brickstream, Atlanta; Software; $6.2 million (1st)

Investors: Columbia Capital and Mohr Davidow Ventures

14. Lancope, Alpharetta, Ga.; IT Services; $5 million (2nd)

Investors: HIG Ventures and GMG Capital Partners

14. Oculan, Raleigh; Networking; $5 million (4th)

Investors: Soros Equity Partners

16. MediaSpan Group, Durham; IT services/software; $4.5 million (1st)

Investors: Covesco-Seteura, Rustic Canyon Group and Southeast Interactive Technology Funds

17. HAHT Commerce, Raleigh; Software; $4.1 million (3rd)

Investors: Banc of America Capital Investors, Canaan Partners, CIBC Capital Partners and Granite Ventures

18. Q1 Labs, Atlanta; Software; $3.3 million (1st)

Investors: Business Development Bank of Canada and New Brunswick Investment Management

19. Flexlight, Atlanta; Networking; $3 million (2nd)

Investors: Coral Ventures and Concord Ventures

19. Quellan, Atlanta; Hardware; $3 million (2nd)

Investors: Cordova Intellimedia Ventures, Greenspring Ventures, ITU Ventures, National Semiconductor, University Financing Foundation and Yamacraw Seed Capital Fund III

21. CoreCard Software, Norcross, Ga.; Software; $2.5 million (NA)

Investors: Intelligent Systems

22. Qcept Technologies, Atlanta; Hardware; $2.1 million (NA)

Investors: Pittco Capital Partners (lead), Atlanta Technology Ventures and Bergman & Associates

23. Relativity Technologies, Cary, N.C.; Software; $2 million (4th)

Investors: Noro-Moseley Partners and Wakefield Group

23. AvidXchange, Charlotte; Software; $2 million (2nd)

Investors: Charlotte Angel Partners, Piedmont Angel Network and and individuals

23. Auctionworks, Atlanta; Software; $2 million (2nd)

Investors: Undisclosed

23. NuTech Solutions, Charlotte; Software; $2 million (3rd)

Investors: Individuals

27. RSS Solutions, Greenville, N.C.; Software; $1.6 million (1st)

Investors: EdgeStone Capital Partners

28. LiveWire Logic, Morrisville, N.C.; Software; $1.5 million (3rd)

Investors: Gray Ventures and Research Triangle Ventures

28. Trinity Security, Charlotte; IT services; $1.5 million (1st)

Investors: Venture Capital Solutions

30. Synthematix, Durham; Software; $1.25 million (2nd)

Investors: Catalysta Partners and individuals

31. InsLogic Holding, Columbia, S.C.; IT services; $1.1 million (7th)

Investors: Warburg Pincus

32. AfterBOT, Norcross, Ga.; Software; $835,000 (2nd)

Investors: River Cities Capital Funds

33. iReadyWorld, Charlotte; IT services; $650,000 (4th)

Investors: Total Technology Ventures

34. SAK Logistics, Atlanta; Software; $500,000 (1st)

Investors: Individuals

35. Metabolon Pharmaceuticals, Research Triangle Park, N.C.; Biotech; $300,000 (Seed)

Investors: Aurora Funds

36. Noverant, Raleigh; Software; $266,000 (Seed)

Investors: Research Triangle Ventures and individuals

37. Coventor, Cary, N.C.; Hardware; $250,000 (NA)

Investors: Undisclosed

38. StrikeIron, Raleigh; Software; $150,000 (Seed)

Investors: Aurora Funds

39. RYLA Teleservices, Woodstock, Ga.; IT services; $100,000 (2nd)

Investors: Sustainable Jobs Fund

40. VT Silicon, Atlanta; Hardware; NA (Seed)

Investors: ITU Ventures

40. International IT Services, Raleigh; IT services; NA (1st)

Investors: WellFound Technology