Florida companies attracted nearly twice as much venture capital in the first quarter as in all of 2015. The haul, $855.1 million, was the highest quarterly total since the heady days of 2000. For one quarter, at least, Florida is on the venture map; the state grabbed 7.3 percent of the national venture capital pie, instead of the more typical less than 1 percent.
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But there is just one company to thank for that: Magic Leap and its previously reported $793.5 million mega-round from Chinese e-commerce giant Alibaba Group and other investors. The secretive company that is developing “mixed-reality” technology and employing hundreds is headquartered in Dania but moving into a 260,000-square-foot campus in Plantation. Its war chest for growth is nearly 1.4 billion.
In addition to Magic Leap, other South Florida companies receiving funding in the fourth quarter were financial-services firm Tienda Pago Management of Hallandale, receiving $10 million from Accion International, medical device-maker Vigilant Biosciences of Fort Lauderdale ($3.25 million) and Meetoou, a Miami-based video-chat marketplace ($2.58 million). In all, with the Magic Leap effect, South Florida firms received $819.3 million in venture funding in the first quarter and 96 percent of the state’s total, according to the MoneyTree Report from PricewaterhouseCoopers and the National Venture Capital Association released on Friday.
Nationally, venture capitalists invested $12.1 billion in 969 deals in the first quarter of 2016, and $5.1 billion of that went into the software industry, according to the report, based on data provided by Thomson Reuters. Total venture dollars deployed to startup companies for the quarter remained flat and total deal count was down 5 percent, compared with the fourth quarter when $12.0 billion was invested in 1,021 deals. Compared with Q1 2015, dollars and deals are both down 11 percent. This is the ninth consecutive quarter of more than $10 billion in venture capital invested in a single quarter.
Dollars invested in seed stage companies declined 10 percent during the first quarter. For companies receiving venture capital for the first time, dollars decreased 31 percent to $1.7 billion in the first quarter as the number of deals declined by 16 percent.
“The first quarter appears to tell us that investors still have faith in the venture ecosystem,” said Tom Ciccolella, U.S. Venture Capital Market Leader at PwC. “However, the increase in expansion and later-stage financing, combined with the drop in first-time financing, suggests a shift towards relatively mature startups.”
The top 10 deals nationally accounted for 25 percent of total dollars invested in the first quarter. Magic Leap was the No. 2 deal in the U.S., following ride-sharing service Lyft’s $1 billion raise that included GM as an investor.
MoneyTree Report results are available online at nvca.org.