Quarterly Update: Venture Capital

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Houston companies raised $389.6 million in venture capital (VC) funding in Q4/21, up from $92.0 million in Q4/20, according to a Partnership analysis of PitchBook data. For the four quarters ending in Q4/21, Houston companies raised a record high $2.02 billion—a near tripling of VC funding over the prior year. 

Both investment volumes and deal counts are up compared to pre-pandemic totals. For the four quarters ending in Q4/21, Houston companies closed 219 VC deals, up 26.6 percent from 173 deals the prior year. 

The average deal size was $11.6 million during the most recent four-quarter period, up from $5.5 million the year before. Several large, growth stage deals contributed to the jump in funding. The three largest deals of the past year (Solugen, HighRadius, and Lancium) account for over $800 million in VC funding. 

On an industry basis, information technology raised $632.1 million in the four quarters ending in Q4/21, up 190 percent from $217.9 million during the prior four-quarter period. Healthcare raised $518.4 million, up 65 percent from the prior period. Materials and resources raised $426.5 million, up 628 percent largely on account of the $357 million Solugen deal. Business products and services (B2B) are up 745 percent, largely due to the $98 million Cart.com deal.  Energy is up 78 percent, and financial services are up 90 percent from the previous 4-quarter period. However, consumer products and services (B2C) are down 64 percent.     

Prepared by Greater Houston Partnership Research

Roel Gabe Martinez, GISP, CERP
Director, Research
713-844-3619
rmartinez@houston.org