DC-area investments slumped in 2014, despite a strong 4th quarter - Technical.ly DC

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Jan. 19, 2015 10:18 am

DC-area investments slumped in 2014, despite a strong 4th quarter

D.C. companies raised $1.08 billion in 2014, a sharp decrease from the $1.6 billion in 2013. But they also had their strongest fourth quarter for investments since 2007.

Optoro, founded by Tobin Moore and Adam Vitarello, helped the D.C. metro area round up $359 million in investments in the fourth quarter.

(Photo courtesy of Optoro)

2014 was not a great year for investments in the D.C. metro area.

Last year, venture capitalists closed $1.08 billion in deals in the area spanning D.C., West Virginia, Virginia and Maryland, according to the quarterly MoneyTree Report from PricewaterhouseCoopers LLP and the National Venture Capital Association.

That’s a more than 30 percent decrease from 2013, which saw VC deals in the D.C. area reach $1.6 billion.

But there are a few silver linings:

  • Despite a poor third quarter last year, the fourth quarter was exceptionally strong. VCs invested $359 million in the area between October and December 2014. That’s the highest fourth quarter the D.C. metro has seen since 2007.
  • The number of deals is increasing. VCs closed 196 deals last year: that was the highest amount since 2008. Of course, that also means that D.C. metro companies are raising smaller amounts overall.
  • But the percent of VC dollars invested in the region also decreased sharply, from 5.3 percent in 2013 to 2.2 percent last year.
  • The top 10 deals in the country were all made in California and New York, with two exceptions in Florida and Massachusetts. The company that raised the two largest rounds in 2014 — you guessed it — was Uber, which collected $1.2 billion, twice. Other usual suspects included VICE Media ($500 million), Snapchat ($486 million), AirBnB ($475 million), Dropbox ($325 million), and also WeWork ($355 million), which opened its third D.C. location in Dupont Circle last November and received approval last July to open its first residential building in Crystal City.

Below are the 5 D.C. metro area companies that won the largest investment jackpots in 2014 (through one or several investment rounds):

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  1. Herndon-based Edgeconnex, which provides infrastructure services for telecommunications companies, raised $50 million.
  2. Lanham-based Optoro, which helps retailers sell their unused inventories online, also raised $50 million.
  3. Dupont Circle-baed Vox Media raised $42.4 million, according to the report — it announced last month that it had closed a $46.5 million round.
  4. Bethesda-based Telcare Inc., a company that creates apps for patients with chronic illnesses, raised $34.7 million.
  5. Arlington-based Endgame, a cybersecurity software company, raised $26.3 million.

Hinge, the dating app for people already in your social network that relocated from D.C. to New York in 2013 ($17.5 million) and D.C.-based TrackMaven, the online marketing software company ($14 million) also made the top 10.

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