Prepared by Capital Hunter analysts
Venture capital slipped to $519 million this period despite the fact that 48 companies received investment, up from 35 the previous period. The reason for the discrepancy is due to the fact that there were three companies that received funding in excess of $90 million last period, whereas this period the largest investment was only $50 million, which was placed into IT waste management company NewMarketIT. NewMarketIT, which provides data erasure, remanufacturing, remarketing and recycling of personal computer components, received their first institutional round of funding from Catterton Partners in order to expand their business throughout the U.S. and to move into other IT related areas including cell phones and PDAs. The second largest funding this period was Motricity, a mobile content company which received $32 million in late stage funding from a consortium of blue chip venture capital firms including Intel Capital, Wakefield Group, New Enterprise Associates, Noro-Moseley Partners, Technology Crossover Ventures, Sienna Ventures and others. Motricity plans to use the funding, which will be drawn down in separate stages over the next few months, to expand the range and reach of their mobile content. The funding round was part of a larger Series G round completed earlier this year. Three separate financings tied for third place with $30 million each, including vaccine provider NanoBio, wireless LAN systems provider Trapeze Networks and immunology biotechnology developer TolerRx Pharmaceuticals. Funding sizes are starting to stabilize following the past few weeks where it wasn’t unhead of to see a company raise in excess of $100 million. We are unsure as to whether we will see more mega financings in the near future, but if we do, you will be able to find them here.
Regional funding distribution remained constant, with California receiving the lion’s share of the venture capital, with Boston, New York and Austin receiving substantial sums, albeit small compared to the California juggernaut. The other two states seen in the chart below, Michigan and North Carolina, are each represented by only a single investment, which are NanoBio and Motricity, respectively. Industrial funding was far more diverse, with no less than five different sectors receiving in excess of $50 million, including IT services (due largely to NewMarketIT), telecommunications, and semiconductors. Software and biotechnology continued to lead the pack, as they normally do on a quarter-by-quarter basis, with $112.2 and $111.8 million, respectively, going to those sectors. Industrials, which accounted for the largest share of the pie last period, fell off completely this period, as we did not come across a single company. We suspect that the weekly funding will be very lumpy for this sector, as much of the new funding is going toward capital-intensive projects such as ethanol plants and solar cell technology. Do not be surprised however if this sector becomes one of the most popular in the near future, as many believe we need to wean ourselves off of oil due not only to the environmental costs fossil fuels have created, but also due to the fact that much of the world’s oil is held in unstable regimes and new oil discoveries may be on the wane. Stay tuned.
There were three IPOs this period, the same amount as there were last period, when Security Capital Assurance, Osiris Therapeutics and Buckeye GP Holdings listed newly minted shares. Two of the three, Evercore Partners and Aircastle, have risen sharply since their debuts and currently trade at a 20% premium to their offering price. Qimonda AG has not done too shabby either, as its share price has risen from $13 to $14, but it had to cut its offer price by over 30%, so you can’t be too thrilled with its performance thus far. Without further ado, here are the three companies:
Aircastle
NYSE:AYR priced at $209.1 million and is an operator and lessor of commercial jetliners to passenger and cargo airline companies.
Qimonda AG
NYSE:QI priced at $546 million and is a German provider of semiconductor memory products.
Evercore Partners
NYSE:EVR priced at $82.95 million and is a provider of merger and acquisition advisory and asset management services.
