Venture funding of Orange County companies rose sharply in the first quarter from a year earlier, boosted by health care deals and a big cash infusion into real estate auction website Auction.com.
A total of 15 O.C. companies received $230.7 million in venture financing during the quarter, up from 14 companies and $171.9 million in funding a year earlier, according to data firm CB Insights.
O.C.’s dollar volume of deals was down modestly from $245.3 million in the fourth quarter, but the number of transactions was up.
The county's venture-dollar take in the latest quarter beat Los Angeles County’s total of $174.5 million, though L.A. saw more than twice as many individual companies funded.
O.C. also took in more venture money last quarter than many entire states, topping Washington ($151 million), Pennsylvania ($145 million) and Colorado ($99 million), among others.
Nationwide, venture funding reached a 13-year high of $9.99 billion in the first quarter across 880 deals, up from $6.94 billion and 841 deals in the same period a year earlier.
The biggest O.C. venture deal in the latest period was a $50 million investment in Irvine-based Auction.com by Google’s investing arm, Google Capital. Auction.com, launched in 2007, says it’s the largest U.S. online real estate market. It says more than 100,000 residential and commercial properties have been sold via the site.
For Google, Auction.com represents yet another “disruptive” technology to foster. “Auction.com has quietly built one of the largest marketplaces on the web,” said David Lawee, partner at Google Capital. “We think Auction.com can fundamentally change how real estate, and particularly commercial real estate, can be bought and sold, leveling the playing field for smaller investors.”
In the second-biggest O.C. deal last quarter, AqueSys got $43.6 million in Series D funding from a consortium of venture investors. The 7-year-old Aliso Viejo-based company is developing tiny gel stent implants designed to limit vision loss in people with glaucoma by relieving fluid pressure. AqueSys’s stents have been approved in Europe but are still awaiting U.S. Food and Drug Administration approval.
With an estimated 70 million people suffering from glaucoma worldwide, AqueSys has rivals in the race for new treatments. One of those rivals is Ivantis. The Irvine company, which also is developing micro stents, got $14 million in Series B funding last quarter from a venture consortium separate from the one that financed AqueSys.
O.C.’s fifth-biggest venture deal was a $20 million Series B investment in Cylance , a cybersecurity firm founded in Irvine in 2012 by Stuart McClure. He was former chief tech officer at McAfee.
Cylance says its "presponse" approach to security is based on algorithms and machine learning. The basic idea: Build a network security system that can evolve to anticipate new hacker threats, rather than just battle threats already known. The $20 million in fresh capital was supplied by a group led by Blackstone Group,Khosla Ventures and Fairhaven Capital.
EQUITY FINANCINGS FOR ORANGE COUNTY VENTURE-BACKED COMPANIES*
|1 Q 2014||4 Q 2013||3 Q 2013||2 Q 2013||1 Q 2013|
|Number of Financing Deals||15||11||12||19||14|
|Amount Invested ($M)||$226.5||$245.3||$128.3||$174.1||$171.9|
TOP 10 DEALS IN ORANGE COUNTY
|COMPANY NAME||DESCRIPTION||CITY||ROUND TYPE||RAISED ($MM)||INVESTORS|
|Auction.com||A provider in asset management and real estate sales||Irvine||Private Equity||$50||Google Capital|
|AqueSys||Ophthalmic implantable devices||Aliso Viejo||Series D||$43.6||Longitude Capital, SV Life Sciences, Accuitive Medical Ventures, The Carlyle Group, Rho Ventures|
|Axonics Modulation Technologies||Developer of implantable neuromodulation technology||Irvine||Series A||$32.6||Legend Capital, Undisclosed Investors, Edmond de Rothschild Investment Partners, Neomed Management|
|Kareo||Medical office software||Irvine||Series G||$29.5||Silicon Valley Bank, OpenView Venture Partners, Greenspring Associates|
|Cylance||Cybersecurity products and services||Irvine||Series B||$20||Khosla Ventures, Fairhaven Capital, Blackstone Group|
|ClariPhy Communications||Chip production for telecom||Irvine||Series E||$14.2||Norwest Venture Partners, Allegis Capital, ONSET Ventures|
|Ivantis||Glaucoma solutions||Irvine||Series B||$14||New Enterprise Associates, Ascension Ventures, MemorialCare Innovation Fund, Delphi Ventures, GBS Venture Partners, EDBI, Vertex Venture Holdings|
|BlueCava||Digital advertising products||Irvine||Series B||$13||S3 Ventures, PerformanceEdge Partners, Zeitgeist Capital|
|Clear Catheter Systems||Medical devices for obstructed catheters||Anaheim||Series B||$4.2||California Technology Ventures, Foundation Medical Partners, Aphelion Capital|
|AlpineReplay||Tracking tool for snowboarders||Huntington Beach||Seed||Seed||Allegro Venture Partners, Amplify.LA, Crosscut Ventures|
*Equity financings include cash investments by professional venture capital firms, corporations, other private equity firms, and individuals into companies that have received at least one round of venture funding.
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