Venture capital

Venture funding in DMV region down 15 percent in Q2

The latest MoneyTree Report shows an investment slowdown across the country, really.

Save that money. (Photo by Flickr user Pictures of Money, used under a Creative Commons license)

In 2016’s second quarter, a total of 36 local businesses secured $209 million in venture funding. That’s down 15 percent from the second quarter of 2015 when D.C. saw 49 deals totaling $244 million.
All this is according to a new report from PricewaterhouseCoopers and the National Venture Capital Association, with data by Thomson Reuters.
“In terms of investment dollars in the region, we’re not seeing an overabundance of very large deals,” Brad Phillips, director of emerging company services at PricewaterhouseCoopers, told the Washington Post. “Even non-traditional lenders — hedge funds, mutual funds — have been scaling back their investments.”
When venture capitalists do decide to invest, though, the software industry is the far-and-away winner.
According to the Post, over 40 percent of investment dollars in the D.C. region went to software companies. This holds true for the biggest single investment story of Q2 2016 — Kit Check. The company that bills itself as a “friend to hospital pharmacists” announced a $15 million Series C in June.
“Venture capitalists are looking to fund companies with disruptive technology and business models, and they like companies with a short window to market,” Phillips told the Post, by way of explanation.
The venture slowdown is far from a D.C. phenomenon — the numbers here mirror a national trend. Venture capital investment in the U.S. dropped 12 percent from $17.4 billion in Q2 of 2015 to $15.3 billion in Q2 of 2016. Baltimore reported that Maryland also saw a decline.

Companies: The Washington Post / National Venture Capital Association / PricewaterhouseCoopers

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