Tech funding doubles in Minnesota from 2010 to 2011

by Zach Robins

Categories

Money TreeIf ever there was a sign of a hot market, this is it.

The latest figures gathered by TECHdotMN show that the volume of dollars invested into Minnesota tech ventures doubled year over year, from $60m in 2010 to over $126m in 2011, respectively.

This data includes IT, Web, Mobile, SaaS and hardware companies reporting investment rounds in excess of $25,000 and does not account for unreported or undisclosed transactions.

Notable deals of the year include Ability Network’s $27m round, Cima NanoTech’s $15m D round, 8thBridge’s $10m series B, RedBrick Health’s $5.7m raise, and TST Media’s $3.5m Series B. All in all, 63 unique companies raised capital throughout 2011.

The increase in funding can be attributed in part to The Minnesota Angel Investment Tax Credit as 2011 was the first full year of the tax credit, which was approved in April, 2010. True to its name, the credit aims to benefit angel investors and spur early activity rather vs. large institutional funds. The state’s 2011 tax credits were fully allocated, and $12m has been earmarked for the 2012 tax credit.

2012 looks equally bright for Minnesota as Code 42’s $52.5m investment round announced earlier this month points to another annual rise in overall funding and continued growth in Minnesota.  Below is the quarter to quarter data from 2011:

$38m raised; 21 startups Q1

$35m raised; 19 startups Q2

$34m raised;  24 startups Q3

$19.5m raised; 28 raised Q4:

Date Type Company Amt. Note(s)
12/28/2011 Equity Datacom International $2m
12/5/2011 Equity Field Solutions $500k
12/2/2011 Equity DelaGet $200k
11/10/2011 Equity Naiku $320k
11/4/2011 Equity enStratus $3.5m
10/28/2011 Equity CaSTT $600k
10/26/2011 Equity CRAM $50k
10/24/2011 Equity Optimine $3.6m
10/16/2011 Equity Field Solutions $3.5m
Q4 – AITC Equity 3D Sports Ventures $220k
Q4 – AITC Equity Accelerated Innovations $1m
Q4 – AITC Equity Anser Innovation $140k
Q4 – AITC Equity Argos Risk $450k
Q4 – AITC Equity AsystMe $67.5k
Q4 – AITC Equity AtPlayMusic (stealth) $187.5k
Q4 – AITC Equity Brilliant Nations $73k
Q4 – AITC Equity Conservis $170k
Q4 – AITC Equity Early Learning Labs $100k
Q4 – AITC Equity Echobit $50k
Q4 – AITC Equity ForMyChildren (stealth) $22.5k
Q4 – AITC Equity HSIO Technologies $1.5m
Q4 – AITC Equity Instant Wireless $71k
Q4 – AITC Equity Jericho Ventures (stealth) $325k
Q4 – AITC Equity Localoop $208.5k
Q4 – AITC Equity MIDART Communications $50k
Q4 – AITC Equity Nitch $50k
Q4 – AITC Equity Packet Power $225k
Q4 – AITC Equity Seeonic $125k
Q4 – AITC Equity Vizsy (stealth) $160k

Comments

  • Mike Burkons

    Zach,

    A report was
    issued today that shows that MN also led the Midwest in 2011 in healthcare VC
    funding with $233mwhile Ohio came in 2nd at $188m. (see http://crainscleveland.com/app

    Can someone
    explain why the MSP region is looking to Jumpstart of Cleveland to come in to
    the region to show them how to create a culture conducive for starting high
    growth venture backed companies. MSP is the only major market in the MN and
    Ohio has Cleveland, Columbus and Cincinnati and MN still outperformed OH by
    $50m.

    My guess is
    that MN's $120m funding in tech ventures easily outpaces Cleveland. Maybe
    Cleveland should look to the MSP to see what is working instead of the other
    way around. Also, so much of the funding Cleveland counts are funds that come
    from the State taxpayers directly into companies.

    The only
    thing Cleveland has is taxpayer funded groups like Jumpstart who have a 47
    person staff a CEO who makes over $400k and an overhead budget of over $10m
    needed to invest $2m into startups. Despite all the PR and spin that comes out
    of their own marketing department, the MSP region outperforms all of Ohio and
    really puts the Cleveland area to shame.

    They have
    been around since 2004 burned though close to a $100m dollars in funding and it
    is sad that despite their true results, they are going into regions like the
    MSP and offering their expertise.

    Mike Burkons

  • Tech Columbus

    Here in Ohio we have an organization called TechColumbus, which provides funding to tech entrepreneurs to help them get started. You can read more about them at 
    http://www.techcolumbus.org/

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