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January 11, 2024
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VC Spending in 2023: Unveiling Baltimore’s Q4 Success and Beyond

TLDR:

– Baltimore’s venture capital (VC) numbers should not be lumped together with those of other cities, as it could be harmful to Baltimore’s ecosystem.
– The NVCA and PitchBook’s Venture Monitor reported a decline in VC deal activity in Q4 2023, citing factors such as political risk and evolving dynamics in global supply chains.
– Despite the overall decline, investments in AI, life sciences, and clean tech have surged, indicating interest in these fields from both the public and private sectors.
– In 2023, a total of $725.81 million was raised across 99 deals in the Baltimore metropolitan statistical area (MSA).
– The fourth quarter of 2023 saw a decrease in both the total capital raised and the number of deals in the Baltimore MSA compared to the same period in 2022.
– PitchBook’s reporting methodologies exclude important types of capital, such as grant capital and exit funding, which UpSurge Baltimore is now focusing on to provide a more comprehensive view of VC activity in Baltimore.
– UpSurge Baltimore plans to broaden the geographic scope of its analysis to track investment levels in Baltimore’s startups.
– The region’s innovation ecosystem saw investments in healthcare, biotechnology, financial services, education technology, and IT. Top deals included funding for ManaT Bio ($120 million), Elixirgen Therapeutics ($67 million), Cerebro Capital ($21.7 million), Concentric Educational Solutions ($5 million), and Turngate ($17 million).
– Noteworthy deals in 2023 included Blackpoint Cyber’s raise of $190 million in Q2, Dragos’ Series D extension, Huntress’ $63 million raise, Fearless’ $32 million venture debt, Scene Health’s $17.7 million Series B, and Haystack Oncology’s acquisition for $392 million.

Article:

Every quarter, Technical.ly receives insights into fundraising, investments, exits, and other relevant industry analyses via the National Venture Capital Association’s (NVCA) and PitchBook’s Venture Monitor. These reports provide a comprehensive overview of venture capital (VC) activity in various cities and regions. The latest report, publicly debuted on Thursday, highlights the Q4 performance of the US VC market and sheds light on Baltimore’s VC landscape in 2023.

According to the Venture Monitor’s summary, the VC landscape shifted in 2023 due to factors such as heightened political risk and evolving dynamics in global supply chains. Despite the decline in deal activity overall, there are positive national trends with investments surging in AI, life sciences, and clean tech, reflecting substantial interest from both the public and private sectors in these advancing fields.

In 2023, the Baltimore metropolitan statistical area (MSA) raised a total of $725.81 million across 99 deals. Comparing this to Q4 2014, where only $57.62 million was raised through 18 deals in the Baltimore MSA, it becomes clear that the region has seen significant growth in VC activity over the past decade. However, it is important to note that fourth quarter numbers may not be an accurate predictor of VC trends for the following year.

PitchBook and the NVCA reported a total capital raise of $153.92 million across 21 investment deals in the Baltimore MSA in Q4 2023. This indicates a decrease in both the total capital raised and the number of deals in the region compared to the same period in 2022. However, these figures do not account for other forms of capital such as grant capital, nondilutive capital, venture debt, and exit funding. Understanding the full landscape of VC activity requires considering these additional sources of capital.

It is worth noting that PitchBook’s reporting methodologies, which focus on VC as a form of financing where capital is invested into a company, exclude important types of capital. UpSurge Baltimore, an equity-minded startup ecosystem builder, takes a more specific approach to tracking VC activity in Baltimore, including grants and exit funding. UpSurge plans to expand the geographic scope of its analysis to track investment levels in Baltimore’s startups.

The Venture Monitor report highlights several notable deals in Baltimore’s innovation ecosystem. ManaT Bio raised $120 million in funding during its Series A1 round, demonstrating the region’s strength in healthcare and biotechnology. Other top deals included Elixirgen Therapeutics ($67 million), Cerebro Capital ($21.7 million), Concentric Educational Solutions ($5 million), and Turngate ($17 million). These investments reflect confidence in the growth potential and impactful contributions of these companies within their respective industries.

Overall, the Baltimore VC landscape in Q4 2023 experienced a decline in deal activity compared to the previous year. However, it is important to consider the broader context and the various forms of capital that contribute to the overall health of Baltimore’s VC ecosystem. By tracking investment levels in Baltimore’s startups and including all relevant forms of capital, a more comprehensive view of the region’s VC activity can be achieved.

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