Venture Investment in Seattle Area Companies Falls 27 Percent in 2016

Two quarters do not make a trend, but the Seattle metro area bucked a national downturn in venture capital investment during the second half of 2016, as measured by both deals and dollars invested.

For the year, however, 2016 was down significantly from 2015 in the Seattle-Tacoma-Bellevue metro area, according to data from Seattle-based PitchBook and the National Venture Capital Association (NVCA), which released its quarterly Venture Monitor report on Wednesday.

The fourth quarter of 2016 saw 77 local deals completed, totaling $561.3 million, compared to 81 deals totaling $190.6 million in the same period of 2015. Nationally, the second half of the year saw a weakening of VC investment, which some observers call a “normalization” of investment levels. Locally, the final six months of 2016 saw a combined 157 deals, up 26 percent from the first half of the year, and $919.7 million invested, up 58 percent.

For the full year, investors poured just over $1.5 billion into 282 local deals, down 27 percent and 23 percent, respectively, from 2015.

A large chunk of the fourth quarter 2016 investment went to OfferUp, the mobile commerce company that raised $130 million and has a post-money valuation of $1.29 billion, according to the report. (PitchBook says private company valuations are calculated using public regulatory filings and information such as the number of shares authorized for sale, issue prices, conversion ratios, stock splits, and other data. Only valuation estimates that fall within a confidence range are made public. OfferUp has previously confirmed a valuation of more than $1 billion.)

Bellevue, WA-based OfferUp’s expanded Series C round topped the list of largest 2016 deals locally, and nationally was tied for the fifth largest deal in the fourth quarter. Other large, local investments in 2016 include:

Avalara, tax compliance software, $96 million, no valuation estimate given
Kymeta, metamaterials antennae, $62 million, post-money valuation: $199.3 million
Alpine Immune Sciences, protein-based immunotherapies, $48 million, post-money valuation: $80 million
Nohla Therapeutics, cellular therapies for hematological disorders, $43.5 million, post-money valuation: $152.5 million
Panopto, video capture and management software, $42.8 million, no valuation estimate given
Rover, online pet care marketplace, $40 million, post-money valuation: $308.6 million
Remitly, international money transfers, $38.58 million, post-money valuation: $190.4 million
Impel NeuroPharma, therapeutics for central nervous system disorders, $36 million, no valuation estimate given
Planetary Resources, asteroid mining and Earth imaging, $34.8 million, no valuation estimate given

Benjamin Romano is editor of Xconomy Seattle. Email him at bromano [at] xconomy.com. Follow @bromano

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