‘The decline … is firmly in place’
A Norwalk startup dubbed i1 Biometrics has stealthily begun raising venture capital funding, as it develops sensors, wireless systems and software to spot concussions in athletes or soldiers.
As it may soon find out, the venture capital markets remain a headache in Connecticut and beyond.
PricewaterhouseCoopers (PwC) tracked 11 venture capital deals in Connecticut in the third quarter totaling $24.2 million, compared to 10 in the second quarter for $16.6 million. However, this year’s third quarter totals came in lower than a year earlier, when venture capitalists did 12 deals totaling $46.4 million.
Venture capitalists continue to show “steady interest” and investment in emerging companies in Connecticut, according to Owen Davis, a partner in PwC’s Connecticut private equity and venture capital practice in Stamford. However, PwC, which tracks venture capital spending on its MoneyTree report, said the 2012 total is unlikely to match that of 2011.
“The decline in funding for seed (and) early-stage companies is firmly in place,” said Tracy Lefteroff, global managing partner of the venture capital practice at PwC, in a written statement. “We’re seeing fewer new venture funds being raised, which means less capital is available for new investments. And we’re seeing venture capitalists be very cautious with the capital that is available due to the lack of a significant number of liquidity events. Instead, venture capitalists are continuing to support the companies already in their portfolio.”
Under Lawrence Calcano, i1 Biometrics is developing a system to spot concussions. Calcano previously was CEO and remains chairman of Bite Tech, a Norwalk company designing high-tech mouthpieces for athletes that has been testing an “impact intelligence system” giving coaches and trainers data on how hard of a hit athletes will sustain.
The Connecticut Technology Council did not include Bite Tech or i1 Biometrics among its 75 “tech companies to watch” with potential for fast growth in the near future, including nearly 20 in Fairfield County.
Those businesses will participate in the sixth annual Innovation Summit scheduled for early November in New Haven. The Crossroads Venture Group is co-hosting the event sponsored by Cantor Colburn, Dickstein Shapiro, the Connecticut Center for Advanced Technology and First Niagara Bank, among others.
Startups were selected from throughout the Northeast, with Fairfield County “companies to watch” including:
- Brain Parade, eBrevia, Milnaa and Relevance Partners in Stamford;
- Budderfly and Logic Technology in Shelton;
- Buses2, Electric Truck and Harvest NRG, and SURFACExchange in Greenwich;
- cloud2health.com in Danbury;
- deets, LiveLobby and SecureRF in Westport;
- Local Yokel Media in New Canaan;
- MedAdherence and MediaCrossing in Norwalk;
- Solar Change in Bridgeport; and
- TCR and WHA Entertainment in Weston.
Meanwhile, with an initial investment of $5 million, Gov. Dannel P. Malloy formally launched Connecticut’s new “Innovation Ecosystem,” with the Stamford Innovation Center already an early hub in the startup program as detailed in an Aug. 7 article (“The Socratic method”) in the Fairfield County Business Journal. Hartford, New Haven and Storrs will host additional Connecticut Innovation Ecosystem hubs, which like the Stamford Innovation Center will provide startup incubator services.
“I know we tend to talk about California and … New York – much of that based upon the more recent success in those places,” Malloy said. “But no place is more steeped in the history of innovation and invention than the state of Connecticut. But in this area like so many others, Connecticut decided to rest on its laurels; to assume that which had transpired in the past would simply transpire again, regardless of whether we … built out the infrastructure necessary for our folks who want to compete.”