Washington’s Top 10 Venture Deals of the First Quarter—and Some Reactions

Xconomy Seattle — 

The first three months of 2010 are in the books. The dreaded tax day has passed. Time to look back at the top 10 venture capital deals in Washington state so far this year, and see what the trends are. What kinds of companies are getting cash? Who’s unable to attract the loot, and why? (For more context, you can also read my colleague Bruce’s latest rundown of the national VC numbers here.)

First, here’s the list of the top local deals, compiled from the Xconomy Seattle archives, with an assist from the MoneyTree Report (PricewaterhouseCoopers, National Venture Capital Association, and Thomson Reuters), Dow Jones VentureSource, and CB Insights. I’ve included the stage of each deal if it was disclosed, as well as links to our prior stories about the companies:

1. Visible Technologies (Bellevue, WA), $22 million, Series C (story).

2. BlueKai (Bellevue, WA), $21.4 million, Series C (story).

3. Calistoga Pharmaceuticals (Seattle), $15.2 million, second tranche of Series B (story).

4. NanoString Technologies (Seattle), $15 million, second tranche of Series C (story).

5. Infinia (Kennewick, WA), $11.5 million (story).

6. Halosource (Bothell, WA), $10 million, Series D (story).

7. Avvo (Seattle), $10 million, Series C (story).

8. New Travelco (Seattle), $9.8 million, Series A (story).

9. Zumobi (Seattle), $7 million (this news comes from the MoneyTree Report; the company tells me this is its third round of funding; see related story here).

10. HemaQuest Pharmaceuticals (Seattle), $6 million (story).

Looking over the companies, they come from a wide variety of disciplines. Five companies are from the software sector (Internet and mobile), three deals went to biotechs (although two were second tranches from rounds announced last year), and two cleantech companies raised cash. But seven of the top 10 were mid-to-late-stage deals, Series C or later, while only one was a first-round funding (New Travelco, the stealthy online travel startup from ex-Expedia execs). The relative dearth of funding for young companies around Seattle remains a concern I hear often, and entrepreneurs are increasingly turning to angel investors or bootstrapping as viable alternatives to raising venture capital.

Meanwhile, Seattle-area investors see the overall funding results from the first quarter as encouraging, but they’re being cautious (and realistic) about the long-term prospects of the sector. “The investment level wasn’t solely dependent on the one big deal, which sometimes happens. A number of companies in the Northwest are getting larger financings completed, and angel and entrepreneurial activity in the marketplace is strong,” said Andy Dale, managing director of Seattle-based Montlake Capital (formerly Buerk Dale Victor), in a statement. “We still need high-quality, successful M&A and some local IPOs to demonstrate that the asset class can make money for long-term investors.”

Chad Waite, managing director of Kirkland, WA-based OVP Venture Partners, added in a statement, “We are encouraged by these numbers and are staying focused on building great companies within IT, biotech and cleantech with a concentration in the Pacific Northwest.”

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