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Houston-based companies raised $265.2 million in Venture Capital (VC) funding in Q3/20 for a year-to-date total of $555.7 million, down 3.9 percent from the same period last year, according to a Partnership analysis of PitchBook data. The 12-month total reached $665.9 million in, down 1.2 percent from 12 months ending in September ’19.
While investment volume is nearly unchanged from last year, deal counts are down considerably as investors grapple with the uncertainties created by COVID-19. Houston founders closed 84 VC deals through the first three quarters of ’20, down from 131 during the same period in ’19. Later stage deals have provided a safer harbor in the second and third quarters than seed and early stage deals in Houston. Investors closed 24 later stage deals through Q3/20, up from 21 deals during that period last year. Earlier stage deals are down by nearly half the ’19 tally.
Notable Q3/20 deals include: $137 million to health tech firm Preventice Solutions, $30.2 million to the plant-based chemicals manufacturer Solugen, and $25 million to the oil & gas logistics platform GoExpedi.
On an industry basis, year-over-year Q3 YTD VC funding continues to favor health care:
Health Care: $232.2 million, up 2.6 percent
Information Technology: $189.1, up 28.7 percent
Energy: $35.8 million, down 61.4 percent
Business Products & Services (B2B): $15.1 million, down 49.2 percent
Consumer Products & Services (B2C): $28.9 million, down 41.6 percent
Materials & Resources: $31.4 million, down 2.8 percent
Financial Services: $23.0 million, up 3,550 percent (from $630k)
Prepared by Greater Houston Partnership Research
Director, Data Analytics
Houston companies received $265.2 million in VC funding in Q3/20