VC trends: Why Philly’s Deal Flow Bounced Back Quickly in 2020
While 2020 was a disruptive year for just about every market and industry imaginable, startups and venture capitalists found their footing in the latter half of the year.
It’s a somewhat surprising trend outlined in PACT’s 2020 Venture Report which uses PitchBook data to analyze how Philadelphia fared amid the pandemic. We saw similar trends and numbers from a recent PricewaterhouseCoopers/CB Insights MoneyTree report.
Basically, despite the pandemic, the region saw a fairly impressive year in deals.
In the region, companies raised $1.8 billion across 221 venture deals by the year’s end, recording the region’s second-highest annual deal value and third-highest deal count despite the pandemic’s economic impact.
The data show that Q1 and Q2 of 2020 saw dips in investments — likely as businesses braced for impact early in the pandemic — but by Q3, investors were pouring money into area companies. It was Philadelphia’s second-highest quarter in deals, and the second time the region raised more than $1 billion in a quarter.
Philly also saw some strong exits, mostly within the biotech and pharma industries, which represent $2.7 billion of the region’s $3.7 billion in value in exits. Also, the IPOs of Accolade, Passage Bio and Prelude Therapeutics generated about $2 billion in combined liquidity. Investors Ben Franklin Tech Partners, BioAdvance and OrbiMed were the principal beneficiaries of this development, exiting a total of 11 investments in 2020, the report found.
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