First-half venture capital investments in Delaware follow the mentality of the rest of the state: small in number, but mighty in impact.
In the first two quarters of 2019, Delaware shows only 25% of the number of total VC deals as 2017 and 2018 — but has already broken the dollar amount for each year, and every year since 2013, according to a recent PwC/CB Insights MoneyTree Report, for a six-month total of $98 million.
And notably, $90 million of the $93 million in Delaware’s Q2 deals were in the healthcare sector. (Two deals were made in Q1, totaling $5 million.) Here are the details of all the deals taking place from April through June 2019:
- Prelude Therapeutics, a Wilmington-based, clinical-stage biopharmaceutical company, got a Series B investment of $60 million from OrbiMed Advisors.
- Ayala Pharmaceuticals, a Wilmington-based, clinical-stage precision oncology company, got Series B investments of $30 million from aMoon Partners; Harel Insurance Investments & Financial Services; Israel Biotech Fund; Novartis; and SBI JI Innovation Fund.
- Printify, a Wilmington-based, print-on-demand marketplace and mediation platform, got seed/angel investments of $3 million from Bling Capital; Evan Moore; Fritz Lanman; Gokul Rajaram; Kevin Lin; Kevin Weil; Steve Chen; and undisclosed angel investors.
“Any way you cut it, it was a good quarter for Delaware,” said Brad Phillips, director of emerging company services at PricewaterhouseCoopers in Washington, D.C., in an interview with Technical.ly. “It was the best first half since 2003 in dollars, and the best single quarter since 2013. Through the first two quarters of the year, companies in Delaware have already raised 120% of what they raised all of last year.”
Prelude Therapeutics’ $60 million in venture capital was Q2’s largest deal in Greater Philadelphia (Philadelphia-Reading-Camden, PA-NJ-DE-MD). The next highest deal in the region was a $37 million investment in Vesper Medical of Wayne, Pennsylvania.
The deal helped bump Delaware in the state rankings for dollars invested from #31 to #22.
While the biggest deals in Delaware are happening in the healthcare industry, nationwide, the top industry for Q2 VC investment is internet, with $12 billion in investments nationwide, followed by healthcare at $4.6 billion, according to Phillips. That’s out of a $29 billion total raised across 1,409 transactions.
“From a national standpoint, the U.S. Q2 2019 funding and deal activity increased,” said the PwC expert.
Some of the national trends and notable features of Q2, per Phillips:
- The rise of the “mega round” — “We define a mega round as one where $100 million was involved,” said Phillips. “Over the last number of years, the number of those have continued to increase. In Q2 we saw 54 of those [nationally], and that’s a record that goes back to 1995. Another significant tidbit is that those mega rounds accounted for nearly half of all of the funding, which is significant when you look at the fact that there were 1,400 deals.”
- Seed rounds were at the lowest point in six years — “Larger deals and fewer deals – the average deal size keeps picking up,” Phillips said.
- Q2 saw the 26th $1 billion+ round in history with a $1.15 billion investment — That’s the 13th-largest round ever raised.
- At the halfway point of the year, there were $55 billion in deals — “At the half point of 2018, there were $48 billion, which at the time was a record for the century.”
- A lot of exits — “When that occurs, that provides investors capital so they can go use and invest in newer startups.”