Venture capital starts cautious rebound; Maine dormant in Q1
Courtesy / PricewaterhouseCoopers
Tom Ciccolella, U.S. Venture Capital leader at PricewaterhouseCoopers.
After finishing last year on a down note, the nation’s venture capital market is beginning a slow rebound, with 1,104 deals worth $13.9 billion in the first quarter of this year.
That’s up 15% in dollars and 2% in deals from the fourth quarter of 2016, according to the MoneyTree Report released from PricewaterhouseCoopers and CB Insights today.
“We look at both the money and the number of deals,” Tom Ciccolella, U.S. Venture Capital Leader at PricewaterhouseCoopers, told Mainebiz. “But the deal count was more or less flat. And the $13.9 billion was the second-lowest quarterly total across the past two years, with the fourth quarter of 2016 being the lowest. So I wouldn’t call this a resurgence. I’d say proceed with caution.”
Maine, which fared well in last year’s fourth quarter with a $3 million investment in Tilson Technology from CEI Ventures and other partners, languished in the first quarter, with no deals listed in the MoneyTree study.
However, the study’s methodology did not count two amended U.S. Securities and Exchange Commission filings in the first quarter by Maine companies. Clothier Rambler’s Way Farm Inc. of Kennebunk raised $6.4 million of a $10 million amended equity filing in February. And Double Blue Sports Analytics of Orono raised $100,000 of a $160,000 amended equity, option and other offering in March.
Other New England states fared well in the first quarter, with Connecticut pulling in $85.9 million in 12 deals, Massachusetts $1.8 billion in 95 deals, New Hampshire $16.2 million in three deals, Rhode Island $18.8 million in three deals and Vermont $150,000 in one deal.
Ciccolella said New England seemed to be relatively stable compared to more precipitous drop-offs in the San Francisco Bay area and Silicon Valley, especially in deal flow.
“We are seeing the U.S. funding environment slip into its new normal,” Arnand Sanwal, co-founder and CEO of CB Insights said in a statement. He added that 2015 was a year of irrational exuberance, and the decline in 2016 was in part a reaction to that.
Sanwal added that a number of large acquisitions and some early initial public offering activity portends good things for venture-backed companies in the United States.
Looking forward to the second quarter in Maine, Catalina Wine Mixer of Portland raised all of a $975,000 equity offering in early April.
Mergers down as well
Mergers and acquisitions were down the first quarter of 2017 compared to the first quarter of 2016, a separate report from market research firm Mergermarket of New York, London and Hong Kong.
The largest deal so far in 2017 is BEF Foods’ $115 million bid for Pineland Farms Potato Co. announced on Jan. 24. The deals were counted based on the acquired company being located in Maine.
Elizabeth Lim, research editor – Americas, wrote in an email to Mainebiz that the first quarter of this year is down 14.1% in disclosed deal value compared to last year’s first quarter, and down by one deal in terms of volume.
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