capital

In the first three quarters of 2015, U.S. venture capital firms have invested $47.2 billion, more than the year-end totals for 17 of the past 20 years, according to new data from the National Venture Capital Association (NVCA) and PricewaterhouseCoopers (PwC). About $16.3 billion was invested in 1,070 deals in the third quarter, bringing the 2015 total to $47.2 billion in 2,239 deals. Investment activity is on track to reach its highest annual level since 2000, and the second highest year since the beginning of PwC’s Moneytree report. Both dollars and deal slightly fell in the third quarter, but still managed to rank as the second most active quarter since 2000.

Venture investors around the world have more confidence in the U.S. market than any other in the world, according to the 2015 Global Venture Capital Confidence Survey from Deloitte and the National Venture Capital Association (NVCA). Israel, Canada, China and the UK also ranked among the top five. The U.S. policy environment, however, received lower reviews. U.S.-based investors have very low confidence in the government’s ability to enact policies that support domestic investment. The U.S. ranked toward the bottom among participating nations, near Brazil and Sweden. Immigration reform was cited as the top policy concern. Venture fundraising also began to cool in the third quarter of 2015, after peaking in the previous quarter. Fundraising was down 59 percent by dollar commitments, the lowest since 2013. Read the NVCA analysis…

Over the past few weeks, the State of Oregon has announced a number of new capital opportunities for small businesses. Business Oregon, the state’s economic development agency, will invest $250,000 to support a new Inclusive Startup Fund that will invest in Portland-area startups founded by women and people of color. Fund leaders hope to raise a total of $3 million and match portfolio businesses with mentoring and business advising services. The agency also announced a new $250,000 loan program to help small manufacturers expand. The Oregon Growth Board announced its own $250,000 investment in an angel fund launched by TiE Oregon. The TAP Fund will co-invest with TiE Angels Oregon to support early-stage startups.

Due to a lack of activity by the state’s three privately-run regional EB-5 centers that serve the state of Maine, the Maine Department of Economic and Community Development (MECD) is considering launching its own EB-5 visa program to attract more direct foreign investment to the state, according to the Bangor Daily News. Under the proposed state-run EB-5 program, the state hopes to create economic prosperity and job creation by stimulating foreign direct investment into economic development projects across the state – in return the foreign investors gain a fast-track path to citizenship. To be eligible for the EB-5 program, foreign investors must invest $500,000 to $1 million in a project that helps create or retain at least 10 jobs in the United States. The recent announcement comes almost four years after the state legislature directed MECD to set up a state-run regional center. However, the state has not allocated funding for the program yet, according to the Sun Journal. If Maine proceeds with the proposal, it would be one of only a handful of states that has a state-run EB-5 program. In addition to targeting investment in traditional economic development projects, several states have successfully used the EB-5 program to attract foreign investments in tech startups, advanced manufacturing companies and other projects that help grow their state’s innovation economy.

Update: You can view the full webinar and download the slide presentation at: http://ssti.org/regional-innovation-strategies-program-informational-webinar

This week marked the launch of New York Ventures, an Empire State Development program dedicated to encouraging innovation and fueling economic growth in communities across New York. The program is derived of three separate funds: the $100 million New York State Innovation Venture Capital Fund; the $45 million Innovative NY Fund; and, the $2 million Minority- and Women-Owned Business Investment Fund. As part of the New York Ventures launch, Empire State Development also announced the NYS Innovation Venture Capital Fund’s close on financing for two New York-based tech companies.

Last week, the Department of Agriculture (USDA) held a special meeting that include approximately 100 investors and venture capitalists to help stimulate private sector investments in rural infrastructure projects with the potential to spur economic development in small towns and rural communities across the country. Through its U.S. Rural Infrastructure Opportunity Fund, the USDA has helped to facilitate the investment of nearly $161 million in private capital toward 22 critical water and community facilities projects in 14 states.

Between 1998 and 2010, impact investment funds outperformed funds of the same size, according to the Wall Street Journal. Impact-focused funds of $100 million or less posted a 9.5 percent pooled net internal rate of return, outperforming the 4.5 percent delivered by funds of the same size that were not focused on impact investments. The industry, however, is still in its nascent stage and data remains somewhat scarce. In an article for Quartz, William Burckart contends that wealth management professionals are hesitant to propose impact investment funds to their clients for several reasons, including:

Venture capital (VC) firms invested more than $17 billion in 1,189 deals in the second quarter of 2015, the highest level of activity since 2000, according to the National Venture Capital Association (NVCA) and PricewaterhouseCoopers (PWC). Megadeals (deals greater than $100 million) in the software sector drove much of the growth, with 26 deals such deals, including one that exceeded $1 billion. With $7.3 billion in investments, software deals in the second quarter exceeded total investment across all sectors in 51 of the last 82 quarters. The industry is on track to surpass the $50 million invested last year. Read the NVCA/PWC release…

Last month, Minnesota Gov. Mark Dayton signed the MNVest bill – an intrastate securities exemption that allows Minnesota-based companies and entrepreneurs to raise money through equity crowdfunding. To qualify for the exemption, businesses must show evidence of several requirements including being organized under state laws and that its principal office is located in Minnesota. Companies can raise capital from both accredited and non-accredited investors from across the state. In any 12-month period, a company cannot raise more than: