A surge in fourth-quarter deal-making produced the best year for venture funding in North Carolina since 2002, according to the latest MoneyTree report.
However, if Motricity’s whopper investment from billionaire Carl Ichan and other investors is added in, 2007 would be the best since the “dot com” boom year of 2000.
Jeff Barber of PricewaterhouseCoopers couldn’t explain why the $185 million investment that an Ichan-led syndicate made in November wasn’t included in the statistics that Thomson Financial compiled for the report.
Ichan poured $50 million into the mobile-content-services provider earlier in 2007, but his investment was not considered a venture deal under Thomson guidelines. Thomson data is used to compile the quarterly MoneyTree report for PWC and the National Venture Capital Association.
The November deal should have been included, in Barber’s view, given that Ichan did lead a syndicate of traditional venture investors.
Even without the Motricity funding, though, North Carolina firms produced a strong quarter, with $168.3 million in closings. For the year, Tar Heel firms brought in $577 million, the best year since $584 million in 2001. Funding for N.C. entrepreneurs has increased for three consecutive years since hitting a low of $338 million in 2004.
“This was a really good year,” Barber said in an interview. “This was the best fourth quarter we have had since 2000.”
Including Motricity, the quarterly total would have been $353 million, the biggest since $408 million in deals in the first quarter of 2000.
Add Motricity’s two deals to the annual total, and North Carolina’s funding would soar to more than $812 million. That total would rank as second-highest in the state’s history, trailing only the $1.8 billion that flowed to N.C. firms in 2000.
North Carolina finished 10th nationally in total fundraising, a “barometer” that affirms the state continues to be a top destination for investors and cash, Barber added.
“We’ve been on a strong upward curve,” Barber said. “The whole critical mass in the area – more companies, more people, more entrepreneurs, more ideas – are driving our growth.”
Not counting Motricity, N.C. funding was dominated by life-science deals, with biotech firms raising $45 million and medical device firms closing on $44 million. Software deals resulted in another $21 million in closings, followed by consumer products and services ($20 million), semiconductors ($18.9 million), electronics/instrumentation ($16.5 million) and media/entertainment ($3 million).
