Following the early COVID years that infused surplus capital into the markets, prompting mid to late-stage investors to deploy capital into most any and all deals, venture capitalists are now being diligent and patient with prospective investments, says Skye Henderson, vice president of venture investments of Spokane-based Cowles Ventures.
Tom Simpson, president of the Spokane Angel Alliance, says venture capitalist investors were in a state of triage after the excessive investments made in 2021 into many unworthy or unproven companies. The market has since been correcting, he says.
According to proprietary market data software subscription platform PitchBook, in the first month of 2024, ab out $20 million has been raised by Inland Northwest startups. That’s just over a quarter of the amount raised in all of 2023, when Inland Northwest startups secured a total of $75 million in investment, according to PitchBook.
While the total capital raised by Inland Northwest startups in the last four years has fluctuated, the number of deals stayed relatively even. According to PitchBook data, there were about 18 deals made in 2020, about 23 deals in 2021, about 22 in 2022, and 25 deals made in 2023. Pre-pandemic, the number of deals made in 2019 was 26.
Industrywide, 2023 was a difficult year for seed-stage founders trying to raise series A funding when compared with 2022, reports San Francisco-based equity management platform Carta Inc. In 2023, a total of $11 billion was invested into primary series A rounds, down from $25 billion the year prior.
While investments slowed down in 2023 compared to the year before, there have been some wins by local startups. For example, in September, the fintech startup Treasury4 Inc. received $20 million in series A funding. Simpson says he expects to see a continued uptick in the number of regional startups/emerging companies funded and the amount of total invested in 2024.
Simpson says he currently is monitoring and evaluating more than 10 investment opportunities, a historical high that is not only being fueled by improving market conditions but also the continued inbound migration of talent into Spokane. Simpson credits the increased number of local programs catering to the needs of entrepreneurs, startups, and emerging companies.
