Senior Vice President
New York Market Manager
City National Technology Group
New York City’s hot streak in venture capital financing slowed in the fourth quarter but remained at robust levels, boosted in part by new businesses tied to the fashion industry.
Total venture money invested fell to $1.11 billion across 88 deals, down from $1.37 billion and 119 deals in the third quarter, according to CB Insights.
The latest quarter’s dollar amount of financing still was up 27% from $876 million in the fourth quarter of 2013, though the deal count was down from 96 in that period.
New York ranked third among U.S. regions for venture inflows last quarter, after Silicon Valley and Boston.
The list of the top 10 New York venture deals in the quarter showed the city’s strength in new service-industry business ideas, said Robin Gill, senior vice president for City National’s Technology Group in New York.
The biggest deal was a $355 million Series B investment in WeWork, a four-year-old company that has reimagined the concept of office sharing as a “physical social network.” The company rents space to new businesses while providing various amenities and encouraging collaboration among the diverse tenants.
WeWork now has locations in nine U.S. cities (including Los Angeles) and three overseas.
New York’s second-largest financing in the quarter was a $75 million Series B infusion for Harry’s Razor Co., one of a number of recent startups trying to disrupt established giants Gillette and Schick in the shaving business.
Three of the top 10 deals were investments in companies related to the fashion industry. “They’re using technology to find ways to bring new products to the fashion consumer,” Gill said.
Rent the Runway picked up $60 million in Series D funding. The five-year-old company rents designer dresses and accessories from an online inventory of more than 50,000 items.
Maiyet, founded in 2011 to sell high-end clothing, accessories and jewelry sourced from artisans worldwide, got $25.5 million in Series B funding.
And Bustle, a women-oriented website that includes content on fashion and lifestyle, took in $15.5 million in Series C financing.
EQUITY FINANCINGS FOR NEW YORK CITY VENTURE-BACKED COMPANIES*
|4 Q 2014||3 Q 2014||2 Q 2014||1 Q 2014||4 Q 2013|
|Number of Financing Deals||88||119||104||93||96|
|Amount Invested ($MM)||$1,114.6||$1,367.3||$1,121.3||$837.9||$876.4|
TOP 10 DEALS IN NEW YORK CITY
|COMPANY NAME||DESCRIPTION||CITY||ROUND TYPE||RAISED ($MM)||INVESTORS|
|WeWork||Co-working spaces||New York||Series B||$355.0||Benchmark Capital, Goldman Sachs, JPMorgan Chase & Co.,
T. Rowe Price, Wellington Management, Harvard Management Company
|Harry’s Razor Company||Designs and manufactures razor products||New York||Series B||$75.0||Tiger Global Management, Harrison Metal, Thrive Capital|
|Rent the Runway||Designer apparel and accessories rentals||New York||Series D||$60.0||Highland Capital Partners, Bain Capital Ventures, Technology Crossover Ventures, Advance Publications|
|LiveAuctioneers||Online gateway between auction houses and bidders||New York||Growth Equity||$47.6||Bessemer Venture Partners|
|Return Path||Email intelligence solutions to maximize performance and accountability of email||New York||Series G||$35.0||Union Square Ventures, Foundry Group, Industry Ventures, Vista Equity Partners, Sapphire Ventures, Costanoa Venture Capital|
|Phreesia||Patient self-service and education system for physician offices||New York||Series E||$30.0||HLM Venture Partners, Ascension Ventures, LLR Partners|
|Maiyet||Fashion brand built around rare apparel and accessories||New York||Series B||$25.5||DBL Investors|
|Bustle||News, entertainment, lifestyle, and fashion site for women||Brooklyn||Series C||$15.5||Time Warner Investments, General Catalyst Partners, 500 Startups, The Social+Capital Partnership, Rothenberg Ventures|
|Appboy||Marketing automation apps||New York||Series B||$15.0||InterWest Partners, Blumberg Capital, IDG Ventures, T5 Capital, Icon Venture Partners|
|Eyeview||Personalized video ads technology||New York||Series D||$15.0||Marker LLC|
|The content of Venture Capital Report is compiled from data and sources believed to be reliable, but is not guaranteed as to accuracy or completeness. Opinions expressed are those of the authors or the interviewees and are not necessarily the opinions of City National Bank, member FDIC. This publication is intended to be a source of general information regarding subject matters of interest to our clients. The effectiveness of the advice or suggestions presented, if any, will depend on the reader’s situation and are for the reader to determine. If investments are discussed, the discussion should not be considered or relied upon as specific investment advice directed to the reader’s specific investment objectives, nor should any discussion of specific securities be taken as a solicitation or recommendation for any reader to buy or sell such securities. City National Bank (and its clients or associated persons) may at times have positions in securities and investments discussed from time to time in this publication and may make additional purchases or sales inconsistent with the discussion. City National Bank, as a matter of policy, does not give tax, accounting, regulatory or legal advice. Rules and regulations in the areas of law, tax and accounting are subject to change and open to varying interpretations. The reader is encouraged to consult his or her own tax, accounting or legal adviser.|