VC Investment Surges in First Half of 2021
Ting Gootee is the chief investment officer for Elevate Ventures. (photo courtesy of AgriNovus Indiana)
Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowVenture capital investment throughout Indiana saw a major jump in the first half of the year, according to a new report from Indianapolis-based Elevate Ventures. The report shows VC investment totaled $708 million, marking a more than 300% increase over the first half of 2020. Elevate says a large portion of the activity came from a surge in later-stage deals, or those over $10 million, which was driven by an influx of out-of-state investment and “pent-up demand from the post-pandemic recovery.”
In an interview with Inside INdiana Business, Elevate Ventures Chief Investment Officer Ting Gootee said the surge is reflective of continued global momentum.
“There are national surges in terms of venture activities due to the amount of capital that’s still available and some great momentum from late-stage to early-stage investors all across the board,” Gootee said. “However, more encouraging, the second factor is a lot of Indiana companies, startups in various early and later stages, really fared the pandemic really well in 2020, which resulted in them being fairly attractive targets for out-of-state and in-state investors, which directly led to very robust activities.”
Gootee says the amount of VC investment in the first half of 2021 surpasses the individual annual totals from 2019 and 2020. The report shows the business-to-business tech sector accounted for nearly half of all investment dollars in Indiana and captured 58% of deal activity.
Another factor for the surge, according to the Gootee, is the amount of startup creation that took place during the pandemic. More than half of the deals reported in the first half of the year were less than $1 million, many of which were pre-seed and seed funding rounds.
“We’re continuing to see robust pre-seed and seed activities,” said Gootee. “Many more companies are getting started and they continue to get funded throughout the pandemic and this year.”
Per usual, the majority of VC investment took place in central Indiana. However, Gootee notes that investment continues to grow throughout other regions of the state, especially with scale-up companies.
“It’s really a reflection of some of these other venture communities starting to mature in their own way. Many of them may not be B2B Software-as-a-Service, per se, but they’re getting their own traction in different sectors such as life sciences, ag tech, even in the B2C space and that’s very encouraging,” she said.
Gootee says she hopes to surpass the $1 billion mark by the end of the year.
“If you look at the historical average trend prior to 2017 or 2018, our historical rate on an annual basis had been hovering around $200 to $300 million per year. So, to go from that level to start to have consistency around $500 million invested every year and finally hit the $1 billion mark is going to be a big milestone for our community.”
You can connect to the full report by clicking here.
Gootee says the surge is reflective of continued momentum in the VC market nationally and globally.