Eye-popping. Bonkers. Staggering.
Those are just some of the words industry watchers are using to describe venture capital investment levels in 2021, a year which saw a record $330 billion invested across 17,054 deals in the U.S. That haul of dollars was about double the amount invested in 2020, which you may recall also was a record year for venture capital investing, according to the Venture Monitor report from PitchBook and the National Venture Capital Association.
There’s certainly plenty of dollars flowing into startup companies — everything from crypto to clean tech to health care.
And Washington state received its fair share as well. According to the report, $8.5 billion was invested into 549 deals in 2021 — a mind-boggling 77% increase over the $4.8 billion raised in 401 deals in 2020.
What’s even more amazing are the huge rich valuations being affixed to relatively young companies, which are raising $100 million or more in blockbuster megadeals.
As GeekWire reported Thursday, there are now 16 unicorn startups — privately-held companies valued at $1 billion or more — operating in the Seattle area. Together, that group of companies raised more than $2.5 billion in 2021 — a figure that surpasses the entire venture capital investment total in Washington state for 2018.
Even more interesting, nine of those unicorns — Amperity, Chronosphere, Helion, Highspot, Karat, Place, Rec Room, Rad Power Bikes, SeekOut— were minted in the past 12 months. That trend also plays out globally, with CB Insights tracking 959 unicorns, with 517 of those “birthed” last year. No wonder that CB Insights’ founder Anand Sanwal called the past year “bonkers.”
“It’s crazy, but you have to play in the environment,” said Aviel Ginzburg, general partner at Founder’s Co-op in Seattle. “As a VC, we don’t get to pick the game. We get to make our moves inside of the game, and you always have to be reacting.”
Ginzburg, whose portfolio includes Seattle area unicorns Outreach, Karat and Amperity, said he’s not sticking his head in the sand and ignoring deals, but he’s also trying not to go crazy with excessive optimism. (Editor’s note: Ginzburg is our guest on this week’s GeekWire podcast, so to hear all of his remarks on the current market for venture investing as well as his thoughts on hot startup topics such as Web3, NFTs, Metaverse and more, tune in Saturday morning and subscribe to the podcast here).
Seattle’s overall share of the venture capital pie also increased, coming in at 2.4% of all dollars invested in the U.S. That was up from 1.4% in 2020, and 0.6% in 2016. The San Francisco Bay Area once again led the way in venture capital with a 36% share, followed by New York City at 16% and Boston and L.A, which came in at about 10%.
Here are the top nine venture capital deals in Washington state in 2021, according to the Venture Monitor report, with links to GeekWire stories.
- Helion Energy, $500 million raised, $3.7 billion valuation.
- Umoja Biopharma, $210 million raised, $660 million valuation.
- Outreach, $200 million raised, $4.4 billion valuation.
- Probably Monsters, $200 million raised, valuation not disclosed.
- Chronosphere, $200 million raised, $1.3 billion valuation.
- *Highspot, $200 million raised, $2.3 billion valuation.
- Convoy, $157 million raised, $3.95 billion valuation.
- **Rad Power Bikes, $354 million raised, $1.6 billion valuation
- Cap Hill Brands, $150 million raised, valuation not disclosed.
- *Highspot raised a $248 million venture capital round this week valuing the company at $3.5 billion.
- **Rad Power Bikes raised the $354 million across two separate rounds in 2021.