Startup companies in Michigan received nearly $220 million in venture capital investments in 2014, nearly double the amount received the year prior, says a new report from PricewaterhouseCoopers and the National Venture Capital Association.
This uptick mirrors a national trend, in which venture capitalists invested $48.3 billion in 2014, up 61 percent when compared to 2013.
“There’s been an influx of private equity investors at a level we’ve not seen previously,” says Mark McCaffrey, global software leader and technology partner at PwC, which operates a large practice in downtown Detroit. “As a result, entrepreneurial companies are capable of disrupting entire industries and leveraging investment dollars to expand to the global markets. With the continued economic conditions, we would expect venture capital investing to be positioned to continue strong levels of investing in 2015.”
Bobby Franklin, president and CEO of the National Venture Capital Association, attributes the increase in capital to an improving fundraising environment and the participation increase of non-traditional investors in later-stage funding rounds.
“As the epicenter for technological innovation, the United States has a wealth of groundbreaking startup companies that require the financial capital and business expertise of venture investors to take their businesses to the next level,” Franklin says. “Whether it be a medical device company whose products will save thousands of lives or the software company whose services will transform an entire industry, the venture community is investing in the future of our economy.”
While the amount of capital increased, about 50 Michigan-based companies were on the receiving end of the investments, down 32 percent from the year prior. On a national level, deal volume pushed 4,360 deals, up 4 percent from 2013.