Massachusetts Venture Funding Slimmed Down to $194 Million in March, But Healthcare Investing Swelled

4/13/10Follow @xconomy

It’s no question that March was a disorderly month. Here in New England, 70-degree days were quickly followed by record flooding for the region. The NCAA tournament saw major upsets in nearly every round (only for Duke to win the championship in the end.) Oh, and a little something called healthcare reform was signed into law, after a year of raucous town hall meetings, bitter debate, and talk of baby killers and death panels.

The venture investing patterns in the Bay State last month followed much the same rocky, incongruent path marked by highs and lows. Some sectors rose to heightened levels of dominance, while some disappeared from the startup-investing scheme completely. It all amounted to $194.5 million raised across 17 deals, a slight drop from the month before, when Bay State startups wrapped up $203 million in 26 equity deals. The funding totals made March a pretty average month since we started tracking monthly venture investing in June, thanks to data provided by our New York-based partner CB Insights, a private company intelligence platform. (Five months had higher venture investing totals, and four months fell behind March in dollars raised).

The New England region wasn’t in the only place to experience slowed venture investing last month; Seattle-area deal making fell to $21.3 million across a mere three deals, down from $53.5 million in 10 deals in February. It is worth noting that the 17 transactions in Massachusetts in March tied for the lowest number of deals since we started tracking these numbers. But the fact that March’s 17 deals amounted to about $50 million more than the $145 million raised across 17 deals last June shows that the size of individual transactions might be growing.

If there’s something to brag about from last month, it’s the life sciences sector. Healthcare funding soared to $144.2 million, which represents nearly 75 percent of the venture dollars raised in March. The number of healthcare deals for February and March was even at nine, but the March totals dwarfed the February tally of $89.9 million. All told, healthcare companies

MarchVentureTotals

took up the five highest deal slots in March, and the sector pulled in roughly $120 million more than the runnerup category, Internet.

The biggest transaction was the $35.4 million that went to TransMedics, an Andover, MA-based developer of systems for transporting organs for transplant. Foundation Capital, Kleiner Perkins Caufield & Byers, and Flagship Ventures participated in the round, which included about $9 million of convertible debt.

Gene therapy developer Genetix Pharmaceuticals was right at its heels with the second biggest deal: $35 million in Series B money. The Cambridge-based company attracted new investors Third Rock Ventures and Genzyme Ventures for the round.

As previously mentioned, Internet came in second as a sector, with $24.2 million across five deals in March. This might … Next Page »

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