The Boston area helped drive a boom in U.S. venture capital investment in the second quarter, as funding for area companies topped $1 billion.
In a twist, the majority of Boston’s biggest VC deals in the quarter were businesses other than health care – long the region’s mainstay.
The single largest deal was a $57-million Series A funding package for SimpliSafe, a Cambridge, Mass.-based company that aims to disrupt the home-security industry. Its home-alarm systems use cellular connections instead of land lines, with monitoring costs well below its rivals.
“I’m seeing a lot of very interesting companies in Boston, both on the consumer side as well as the enterprise side,” said Bill Sweeney, East Coast regional director for City National’s Technology Group.
Overall, Boston-area companies took in $1.03 billion in VC money last quarter, up 20% from $859 million in the year-earlier period. A total of 100 companies were funded, up 43% from a year earlier, according to data firm CB Insights.
Despite this strong showing, Boston slipped to third in total funding last quarter as New York City edged into second place, with $1.12 billion in investment. Silicon Valley remained No. 1 by far, at nearly $8 billion.
Among Boston’s biggest VC deals last quarter, Acquia received $50 million in Series F funding from a group led by New Enterprise Associates. The Burlington, Mass., company, launched in 2007, develops website management software using Drupal open-source technology.
No. 6 on Boston’s funding list is Ambri, a Cambridge-based developer of liquid-metal battery technology, which got $35 million in Series C funding from a group that included Bill Gates. Ambri’s batteries are intended for electricity storage that could make alternative energy sources such as wind power more viable.
Although health care didn’t dominate the top-10 list of Boston VC deals in the quarter, the industry still was well represented.
Waltham, Mass.-based Proteon Therapeutics took in $45 million in Series D funding. The company is working on drugs to treat kidney and vascular diseases.
Another Waltham company, 10-year-old Chrono Therapeutics, got a $32 million Series A infusion to further develop its stop smoking bracelet, a nicotine-injection system designed to wean smokers from the habit.
“The health care sector will remain a large opportunity for VC investors,” Sweeney said. “Health care and biotech in Boston are fueled by a very deep ecosystem,” he said. “That ecosystem is made up of some of the best universities, talented and experienced entrepreneurs, and large pharma companies that collaborate with startups, universities and life-science investors.”
EQUITY FINANCINGS FOR BOSTON AREA VENTURE-BACKED COMPANIES*
|2 Q 2014||1 Q 2014||4 Q 2013||3 Q 2013||2 Q 2013|
|Number of Financing Deals||100||88||93||80||70|
|Amount Invested ($MM)||$1031.5||$898.9||$972.9||$608.8||$858.7|
TOP 10 DEALS IN BOSTON
|COMPANY NAME||DESCRIPTION||CITY||ROUND TYPE||RAISED ($MM)||INVESTORS|
|SimpliSafe||Home security systems||Cambridge||Series A||$57||Sequoia Capital|
|Acquia||Open source social publishing system, Drupal||Burlington||Series F||$50||New Enterprise Associates, North Bridge Venture Partners, Sigma Partners, Split Rock Partners, Investor Growth Capital, Tenaya Capital|
|Proteon Therapeutics||Biopharmaceutical company developing a human recombinant protein||Waltham||Series D||$45||MPM Capital, Bessemer Venture Partners, InterSouth Partners, Prism VentureWorks, Skyline Ventures, TVM Capital, Devon Park Bioventures, Deerfield Management, Vectis Healthcare & Life Sciences Fund, Abingworth, Pharmstandard International|
|SilverRail Technologies||Develops technology for railways and travel distributors to easily connect||Woburn||Series C||$40||Canaan Partners, Sutter Hill Ventures, Brook Venture Partners, Mithril Capital Management|
|Epirus Biopharmaceuticals||A global biosimilar enterprise to improve patient access to important medicines||Boston||Series B||$36||5AM Ventures, Montreux Equity Partners, TPG Biotech, Adage Capital Management, Mousse Partners, Monashee Capital, Livzon Mabpharm, Greenwoods Investment, Gibralt US|
|Ambri||Developing an electricity storage solution centered around the liquid metal battery||Cambridge||Series C||$35||Khosla Ventures, Total, Bill Gates, KLP Enterprises, Building Insurance Bern|
|Invaluable||Online live-auction marketplace||Allston||Series D||$33.8||Insight Venture Partners, Commonwealth Capital Ventures, Ascent Venture Partners|
|Chrono Therapeutics||Patient optimized, drug-delivery platform||Waltham||Series A||$32||Canaan Partners, Fountain Healthcare Partners, 5AM Ventures, Mayo Clinic, GE Ventures|
|Dimension Therapeutics||Gene therapy platform development||Cambridge||Series B||$30||OrbiMed Advisors, Fidelity Biosciences|
|NetBrain Technologies||Map-driven network automation software development||Burlington||Growth Equity||$30||Summit Partners|
*Quarterly tallies consist of equity rounds completed in the quarter and in which a venture capital or corporate venture firm participated in the round.
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