January 20, 2012 The Oregonian

January 20, 2012 The Oregonian

Oregon venture capital investment totals $238.6 million in 2011, highest level since2007

Published: Friday,January 20, 2012, 12:15 PM     Updated: Saturday, January 21, 2012, 1:29 PM

By Molly Young, The Oregonian

Oregon startups landed $48.6million in venture capital financing during the last quarter of 2011, cappingthe best year for early-stage investments since 2007.
Venture capital flowing into Oregoncompanies totaled $238.6 million last year, a 25 percent increase from 2010 andthe most in four years, according torecent datacollected by PricewaterhouseCoopers for theNational Venture Capital Association. It’s the second-highest total in adecade, trailing only 2007.

Beaverton-based Agilyx andits $25 million investment roundtopped a list of 10 fourth-quarter deals, compiled by the venture capitalgroup. Investors honed in on cleantech and traditional technology companies.

Butthe year-end activity marks a steep, somewhat expected drop from the precedingquarter. Entrepreneurs attracted $116 million, making it the state’s best quarter since the dot-com era.The venture capital group initially reported companies secured $109 million,but it later revised the data.

Hillsboro’sClearEdge Power, which makes fuel cells, led that quarter — and all 2011 investmentrounds —with $73.5 million infinancing.
The first three weeks of 2012 are pointing to some promising signs for Oregon’s startupcommunity. VendScreen, a graduate of Wieden+Kennedy’s startup lab, announcedTuesday that it hadsecured a $12 millioninvestment round.

Linda Weston, who directs the OregonEntrepreneurs Network, said she’s encountering more and morefounders who are seeking their venture capital for their company. In fact, shehad just wrapped up an hour-long conversation with an entrepreneur in themiddle of an investment round.

“That’s the kind of thing we didn’t hear a few years ago,” she said.

Nationwide,startups raised $28.4 billion infunding last year, a 22 percent increase from 2010, the venturecapital association said in a news release. Much like in Oregon, cleantech companies and web-baseddevelopers carried the growth.

But a number of high-dollar deals inflated the growth, NVCA president MarkHeesen wrote in the release. That means the increase doesn’t necessarily pointto more funding for all startups and industries.

That appears to be true in Oregon,where ClearEdge’s $73.5 million financing round accounted for nearly one-thirdof all venture capital in the state in 2011.

Heesensaid he expects the trend to continue into 2012 as the economy recovers andinvestors focus on certain industries, specifically green and medical technologies.

In Oregon,cleantech companies again emerged as the hottest startups for investors in thefinal months of 2011. Ashlandelectric motorcycle maker Brammolined up $10.6 million in its latest financing round, following only Agilyx andits $25 million series.

Agilyx’ most recent investment attracted at least four out-state firms,including Vancouver, B.C.-based Chrysalix Venture Capital and London’s SaffronHill Ventures. The Beavertoncompany, which converts plastic waste to crude oil, secured a $22 millionfinancing round in March.

Bend medical device companyClear Catheter Systems and ahandful of Portlandhigh-tech developers secured the remaining fourth-quarter venture capitalrounds. The list doesn’t include strategic follow-up investments such as the $15 million Urban Airship raised in Novemberfrom investors that included Salesforce.com and Verizon.

Companies like Urban Airship, which develops push notifications, are makinginvestors take note of the region’s startup community, Weston said. “There’sso much going on now,” she said. “It’s really exciting.”

Venture capital rounds in Oregon,fourth quarter 2011

Agilyx, converts plastic tocrude oil (Beaverton),$25 million

Brammo, make electricmotorcycles (Ashland),$10.6 million

Clear CatheterSystems, designs post-surgical medical devices (Bend), $4.9 million

TrustID, provides caller identification (Portland),$3 million

Puppet Labs, develops automation software (Portland),$2 million*

Cloudability, tracks cloudexpenses (Portland),$1.1 million

4-Tell, makes productrecommendation software (Portland),$960,0000

Vizify, creates interactiveonline profiles, (Portland),$940,0000

Site9, develops Protosharesoftware (Portland),$50,000

Launchside,
web launches (Portland),$30,000

Total: $48.6 million

Source: NVCA

*PuppetLabs announced its round eventually grew to $8.5M.

Molly Young; 503-412-7056; @PDXSmlBizNews

© 2012 OregonLive.com. Allrights reserved.

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