Triangle startup funding plunges in 2nd quarter

Venture capital funding raised by Triangle startups tumbled in the second quarter.

Seven Triangle companies raised $31.7 million in the second quarter, less than half the amount raised in the first three months of the year, according to the latest data compiled and released by accounting firm PricewaterhouseCoopers and CB Insights. It was the worst quarterly performance in terms of funding dollars since the second quarter of 2014.

The number of companies funded, meanwhile, was the fewest since the first quarter of 2013.

Laura Robinette, who heads the Raleigh office of PricewaterhouseCoopers as well as leading the firm’s U.S. pharmaceuticals and life science practice, views the latest quarterly results as an anomaly.

“I think at the end of the year, when you look at it as a totality, I think we’ll be able to call it a really good year,” she said.

It was also atypical, she said, that not a single Triangle biotechnology company raised venture capital funding in the first quarter. The Triangle is a major hub for biotech startups – which require a lot of funding to develop new medicines.

In addition, she said, “there are some great things happening in the marketplace that aren’t accounted for in this report.”

The most notable: G1 Therapeutics, a Research Triangle Park biotechnology company that is still in the development phase, raised $105 million in May in its initial public offering. That IPO followed on the heels of $47 million in venture capital that the company raised last year.

The Triangle’s venture capital numbers can gyrate considerably from one quarter to the next, driven especially by large deals – or the lack of them.

Of the seven Triangle companies that raised venture capital funding in the second quarter, all but one raised just $2.5 million or less. The exception was NeuroTronik, a Durham medical device company, which raised $23.1 million.

On the other side of the state, Charlotte-based financial technology firm AvidXchange raised $300 million in the quarter. That put it in a tie for the 7th-largest deal nationwide.

Nationwide, startups and developing companies raised $18.4 billion in venture capital funding in the second quarter, up 28 percent compared to the first quarter, driven by 31 mega-deals of $100 million or more. Uber’s arch-rival, Lyft, topped the list with $600 million in funding.

The number of companies that raised venture capital funding during the quarter fell 4 percent to 1,152 nationwide.

This story was originally published July 12, 2017 at 12:01 AM with the headline "Triangle startup funding plunges in 2nd quarter."