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Sunday, 18 August 2013 22:00

VC deal flow on par with last year, but investors pledge lesser amounts

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The number of venture capital investments in Michigan through mid-2013 equaled those made in the same period last year, although the dollar value was significantly lower.

Venture capitalists put $20.64 million into 23 deals in Michigan through the end of June, according to the quarterly MoneyTree report from the National Venture Capital Association and PricewaterhouseCoopers. That compares with 23 deals for $80.6 million midway through 2012 and 18 deals for $17.7 million at the same point in 2011.

Among the West Michigan companies to receive venture funding during the most recent quarter was Xtrapickup Corp. in Grand Rapids, which got $600,000 from undisclosed investors. The company operates an online marketplace for local courier services across the country.

The second quarter MoneyTree report also lists the investment of $10,000 each that Grand Rapids-based Start Garden made in June in five startup companies: nu DAWN Heat, Your Chauffeur, Robotic Patient Aid, Underwear Nation, and Shopflow.io.

Those five were among the 10 Michigan-based companies that received a combined $2.62 million in venture capital investments in the second quarter alone, according to the MoneyTree report.

In the life sciences industry, venture investing during the first half of 2013 totaled $37.9 million through six deals, according to Cleveland-based BioEnterprise that tracks investments in life sciences and health care companies in the Midwest.

The first-half total included a $33.62 million investment in Ann Arbor-based Esperion Therapeutics. The total compares with nine deals for $55.9 million halfway through 2012, and five deals for $21.8 million in the first six months of 2011, according to BioEnterprise.

One of the deals listed by BioEnterprise was for Kalamazoo-based Axonia Medical, an early stage company developing new treatments for nervous system damage. Axonia Medical secured a $2.0 million investment in May 2012 in a deal led by the Southwest Michigan First Life Science Venture Fund and that included Ann Arbor SPARK and Western Michigan University’s Research Foundation at the Biosciences Research and Commercialization Center.

The company, which is now in pre-clinical testing, received the final payment on that investment this past spring after reaching a milestone in pre-clinical testing, CEO Harry Ledebur said. The company is now working on securing its next round of funding, Ledebur said.

“We’re looking at our options right now,” he said. “We have some data that is fairly robust and we’re making headway.”

Axonia Medical is leveraging the research of scientific founder Douglas Smith at the University of Pennsylvania to develop its product. The payment to Axonia was reported by BioEnterprise as an investment in the first half but was not listed in the second quarter MoneyTree report.

Across the Midwest, life sciences investments totaled $350.8 million through 117 deals in 11 states during the first six months of 2013, BioEnterprise reported. That compares with 97 deals for $510.6 million midway through 2012 and 75 deals for $315.2 million during the same period in 2011.

BioEnterprise President and CEO Aram Nerpouni noted that the 117 deals during the first half of the year is a five-year high and that the dollar value is “on a par with previous years,” despite the decline from what he called a “banner year” in 2012.

Read 2348 times Last modified on Saturday, 17 August 2013 10:24

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