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Let’s take a look at Philly’s $8B year: Q4 2021 venture capital data is in

Investments in local companies hit an all-time high for one single quarter, with some huge leading deals. Here's which companies got funded.

Philly. (Downtown Philadelphia at sunset by f11photo via Shutterstock)

Editor’s note: These figures may vary slightly, as some deals aren’t accounted for until weeks after quarterly VC reports are published.

While 2021 was a roller coaster of ups and downs for most of us, one bright light shines through for startups and tech companies here: It was the best year ever for Philly’s venture capital deals.

We knew this was coming, after Q3 venture capital data showed us that even with one quarter of the year left, the region had already pulled more than $5 billion in investments. Now that Q4 data is in, per the latest PitchBook-NVCA Venture Monitor report, we can confirm it.

More than $2.6 billion was invested in Philly-area companies across 90 deals in just Q4 of 2021, the largest quarter of the year — and the largest quarter ever on record. The data for the entire year show that the Philadelphia region saw just under $8 billion in investments across 395 deals.

The Philadelphia region, which includes Camden and Wilmington, has been on a steady incline in VC dollars since a dot-com era boom in 2000, but totals for the year usually landed around $1 billion in total until 2019, which hit more than $2 billion. But 2021 shows extreme growth.

What companies got investments in Philly

Some of the top deals of the year went to Philly tech and life sciences companies, namely Gopuff’s $3.6 billion combined investments, Misfits Market’s combined $425 million raises, Century Therapeutics’ $160 million Series C and dbt Labs$150 million Series C.

For Q4, the biggest deals included one of Gopuff’s billion-dollar-plus raises, $90 million for Aro Therapeutics and Crossbeam’s $76 million Series C.

(Caveat: There are some misattributions in the report’s data, including that it counts two $170 million deals from a non-local company called Accel Club in Philly’s Q4 totals. We’re guessing it’s one of those Delaware-in-inc-only cases.)

And the regional trend here is mirrored in what PitchBook saw nationally. In a report accompanying this quarter’s numbers, the company said venture-backed companies raised $329.8 billion, nearly double the previous record of $166.6 billion the year before, in 2020. The number of deals also majorly increased. In 2020, there were 12,173 deals in the US; in 2021, the country hit 17,054 deals.

Pandemic investing trends

The pandemic continues to affect investors and those raising venture capital, but not in the ways we might think, the report said.

“At the start of 2021, many investors predicted that the world would have returned to pre-pandemic ways before year-end, but an ever-evolving virus and new variants of concern prevented those forecasts from coming true,” the report said. “While some investors resumed business travel to meet with founders, virtual meetings — a strange novelty for many just two years ago — have enabled investors to continue doing business and appear here to stay, regardless of the pandemic’s future trajectory.”

The national data also show that the size of the rounds is changing. In 2021, about the same amount of capital (around $13 billion) was invested in seed-stage deals as those in Series A and B, pointing to a trend that early-stage deals are gaining more traction. And lots of companies received their first-ever investment in 2021. But on the flip side, there was also a ton of growth for later-stage mega-deals, those over $100 million, from 2020: $190 billion in mega-deals was invested across 820 deals, way up from 335 mega-deals in 2020.

Also up significantly from 2020 were fundraising numbers for companies with women founders. More than 3,600 companies with at least one woman founder received $54.8 billion in 2021, and 931 companies with all women founders received $6.4 billion.

While it’s still a low proportion of all venture capital, the report showed that Philadelphia was actually the fourth-best place to raise capital as a woman. Women raised $770 million in Philadelphia between 2019 and 2021, behind Los Angeles, the Bay Area and New York, but ahead of Boston.

Companies: Misfits Market / Gopuff / Crossbeam / dbt Labs

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