VC investment in NM experiencing a banner year

Venture capital firms pumped $93.3 million into 11 New Mexico companies in the first half of 2007, representing nearly a 500 percent jump over investment totals for the same period in 2006.

The latest statistics on venture capital activity were compiled by the New Mexico Venture Capital Association, which released its latest survey of investments on Aug. 22.

Venture firms pumped nearly $25 million more into local companies in the January to June period than they did in all of 2006, when investments totaled $68.9 million. During the first half of 2006, investments only reached $16.3 million.

If the current pace continues, by year-end 2007, VC activity will surpass the state's previous annual record of $140 million set in 2005.

"The first half of 2007 was clearly a significant period for venture investing in New Mexico, particularly in the area of later stage rounds, which after being a small component of investments in past periods, represents, overwhelmingly, the largest share of the investment dollars so far this year," said Richard Harding, NMVCA board member and general partner of International Venture Fund. "Most likely, this number is higher than what we will see in future quarters, but it does indicate that companies in the New Mexico market are more than capable of securing big investment rounds."

The survey said $89 million was invested in three later-stage Series B rounds. That includes a $70 million follow-on investment in solar-cell-maker Advent Solar in May.

There were also two rounds of subordinated debt totaling $1.7 million, three seed rounds totaling $700,000, and three early stage Series A rounds totaling $1.9 million, according to NMVCA.

"Increasingly, we are seeing a nice mix in the diversity of rounds," said Francine Sommer, another NMVCA board member and special general partner of Village Ventures, in a news release. "Although the dollars invested in the first half of 2007 greatly favor later stage investments, the deals done were spread evenly among subordinated debt, early, and later-stage investments rounds. This indicates that companies are being successful in meeting their early goals and raising subsequent rounds of money. It's a strong sign of the maturing of the New Mexico venture investing community."