Investment in Maine companies rises sharply
The amount of money raised by Maine companies rose almost fivefold from 2014 to 2015, though the number of total deals remained the same, indicating a rise in the average amount raised per deal.
Maine companies raised $88.17 million in 12 total deals for 2015 versus $18.67 million in 12 deals in 2014. Fourth-quarter deals also were up dramatically year-to-year from two deals worth $2.38 million in 2015 compared to two deals worth $75,000 in 2014. The figures are from the latest MoneyTree Report from PricewaterhouseCoopers LLP and the National Venture Capital Association released Friday morning. The data is based on Thomson Reuters figures.
“I didn’t expect this, but I’m not totally surprised,” Tom Ciccolella, U.S. Venture Capital Market Leader at PwC, told Mainebiz. “The number of deals shows there’s more appetite [for investing]. The deals have almost doubled since 2012 and 2013.”
Ciccolella said the numbers in the report reflect money invested by venture capitalists, angels and other types of investors.
Hyperlite Mountain Gear Inc., a Biddeford-based consumer products and services company, raised almost $1.14 million in an expansion-stage deal in the fourth quarter. Academic Merit LLC, a cloud-based education company in Falmouth, raised more than $1.24 million in an early stage deal. Both were funded by Maine Venture Fund and an undisclosed firm.
In 2015, six firms raised $17.79 million in the first quarter, one firm raised $200,000 in the second quarter, three firms raised $67.8 million in the third quarter and the two firms raised $2.38 million in the fourth quarter to total close to $88.17 million for the year.
Looking at other New England states, 12 deals in Connecticut raised $175 million in the fourth quarter of 2015, 94 Massachusetts deals raised more than $1 billion, three New Hampshire deals raised $21.93 million, five Rhode Island deals raised $9.45 million and one Vermont deal raised $2 million.
Nationwide, the venture capital ecosystem deployed $58.8 billion in 2015, the highest full-year total in the last 20 years. For the fourth quarter of 2015, $11.3 billion went into 962 deals, down 32% in dollars and 16% in deals compared to the third quarter of 2015. The fourth quarter also marked the eighth consecutive quarter of more than $10 billion of venture capital invested in a single quarter.
Ciccolella said in a statement when the data was released: “The fourth quarter’s largest deals included startups that deploy technologies to challenge incumbents in the financial services, education, retail and consumer industries. These emerging tech-enabled segments have disrupted traditional industries and should continue to command a larger portion of venture capital dollars in 2016 and beyond.”
Ciccolella told Mainebiz that companies now can start up anywhere. “As we dive deeper into technology, it costs a lot less to get up and running, and you can do it much faster than you ever could before.”
He added that if there are successful exits for investors, such as acquisitions or initial public offerings, the number of new companies and investments in them could grow, because entrepreneurs from the exit companies will form new companies and stay in the state.
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