Apr 14, 2023 - Business

Startup funding remains strong in the Triangle despite national slump

Data: PitchBook; Chart: Axios Visuals

While venture capital investments into startups continue to fall nationally, those in the Triangle continue to bring in more funding.

Driving the news: Startups in the Raleigh and Durham metro areas raised more than $414 million in the first quarter of the year, according to the most recent data from PitchBook.

  • That's an increase of 34% from the last quarter and 61% year over year.

Why it matters: The numbers are another indication that the Triangle's startup ecosystem is resilient in the face of national declines, despite rising interest rates and the scare of Silicon Valley Bank's collapse.

What they're saying: Scot Wingo, founder of the Durham mobile car-care startup Spiffy — which raised $30 million in the quarter — said the Triangle's diversity of industries has helped its growth.

  • If software companies are having a down quarter, biotech startups might instead lead the way, said Wingo.
  • "When one segment is under pressure (business-to-business software right now), then we have others that pick up the slack," he told Axios.
  • He noted the Triangle also has fewer late-stage startups, a segment that has declined nationally for seven straight quarters.

The largest funding rounds in the first quarter were:

  1. Pathalys Pharma, a Raleigh-based biotech company making therapeutics for kidney disease, raised $150 million.
  2. Portside, a Research Triangle Park and San Francisco-based aviation software company, raised $50 million.
  3. Spiffy, the Durham mobile car-care startup, raised $30 million.
  4. Elo Life Systems, a Durham company making sustainable sweeteners, raised $25 million.

What's next: The second quarter is already off to a strong start: Teamworks, a Durham sports software company, raised $65 million from investors.

Wingo said it's still too early to say how the next quarter will fare — but he's expecting it to be a record breaker for his investor fund, Triangle Tweener Fund, with at least 15 local investment deals lined up.

  • There's "still a lot of people and companies moving here," he said.

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