Home Economic Development Venture money soars; NY rules roost

Venture money soars; NY rules roost

Venture capital investments in Fairfield and New Haven counties more than doubled in the second quarter of 2013 compared with Q2 last year, according to a recent report.

Thirteen companies received a total of $31 million last quarter, according to a MoneyTree report from PricewaterhouseCoopers and the National Venture Capital Association.

The increase in funding is a positive sign of economic growth for the counties, but eastern Connecticut is not the only region to see an increase. As a percentage of total venture capital dollars spent in the New York metro, Connecticut made up only 4 percent of all money spent. Lower Fairfield County made up only made up 1.4 percent.

“Growth in the region has been very positive,” said David Silverman, a PwC managing partner for the New York Metro Emerging Company Practice. “But it’s largely driven by New York City in Manhattan, south of 50th Street. That’s where the venture capital dollars are flowing into and more than in prior years.”

The amount spent in Connecticut has steadily risen since 2008, but at best the region only seems to be keeping pace with New York levels.

Since 2009, Fairfield and New Haven counties have slowly seen their slice of the capital pie decrease from 8 percent to 5 percent in 2012. The two counties are considered a part of the New York metro region, whereas the rest of the state is included in New England data sets. Thomson Reuters compiles the data for the PwC report.

Peter Longo, chief investment officer of Connecticut Innovations, said he’s seen a big increase in startup activity if Fairfield County, especially compared with four years ago.

Since Gov. Dannel P. Malloy in his 2011 jobs bill gave CI an infusion of funding, the organization has more than doubled its investment levels. In the last two years CI officials have invested about $25 million each year, compared with $12 million to $15 million in previous years.

“There’s been a lot more attention to startups,” Longo said. “The economic environment from 2008 to now has created a lot of people wanting to create their own companies as a result of the economic crisis and coming out of it.”

CI, established by the Connecticut legislature in 1989, is a quasi-public financing organization aimed at helping companies start and grow in the state. By a large margin it is the largest investor in the state.

Last quarter three of the largest CI investments went to Local Yokel Media, On Demand Real Time and Thetis Pharmaceuticals.

Local Yokel Media, based in Stamford, received a roughly $2.15 million, early-stage investment to further develop its online platform that delivers ads based on zip code and user demographics.

On Demand Real Time, also based in Stamford, received about $1.75 million. The company plans to build up its software, which records video sports clips in real time based on specific commands.

And Thetis Pharmaceuticals received about $1.1 million to develop a fish-oil based drug to treat diabetes and dyslipidemia (too many lipids in the blood). Owners of the Southport company were previously displaced Pfizer employees after a recent downsize.

“We’re seeing a lot of activity,” Longo said. “It’s a lot different than it used to be.”

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