Austin’s 2019 VC Investment Hits $1.7 Billion, up Nearly 28 Percent from 2018

In 2019, Austin-based private companies raised $1.7 billion, up almost 28 percent from 2018, another record year, according to the latest MoneyTree Report from PwC and CB Insights.

The report found investors did 151 deals in 2019, up almost 22 percent from 2018.

And in the fourth quarter of 2019, Austin-based startups raised $295 million, up 34 percent from the

same quarter a year ago in 37 deals, up 37 percent, according to the report.

RigUp landed on the MoneyTree report for the top ten investment deals of 2019 twice. It earned the top spot with its $300 million Series D investment announcement in the third quarter and claimed the ninth spot with its Series C investment round of $60 million in the first quarter.

Other Austin companies on the top 10 investment list in Texas last year included SparkCognition with $100 million raised in the fourth quarter and Siete Family Foods with $90 million raised in the first quarter. Austin-based ScaleFactor also made the list with $60 million raised in the third quarter.

Overall, Texas’ venture capital investment in 2019 hit $3 billion, up 30 percent from 2018, according to the MoneyTree report.

The report found investors made 267 deals in 2019, down slightly from 275 deals a year earlier.

In the fourth quarter, venture capital investment was $499 million, up almost 4 percent from the same quarter in 2018.

The top five deals in the fourth quarter included a $100 million venture capital investment into Spark Cognition of Austin. And The Zebra reported receiving a $39 million Series C round of funding to claim the second-largest deal of the quarter. Shipwell of Austin with a $35 million round came in third. And Houston-based Expedi landed $25 million to claim fourth place followed by San Antonio-based Airstrip Technologies with $21 million.

Overall, Texas ranked fourth nationally for deal activity behind California, New York and Massachusetts. Those three states rake in 77 percent of all the venture capital in the United States, according to the MoneyTree Report. Texas ranked ninth for overall investment dollars.

Nationally, U.S. VC funding fell in 2019 nine percent to $108 billion, still the third biggest year ever. And in the fourth quarter, U.S VC-backed companies raised $23 billion, down 16 percent compared to the third quarter.

Other significant trends include a drop in the number of $100 million-plus rounds, which fell to 38 companies in the fourth quarter, compared to 58 in the third quarter and 67 in the second quarter, according to the MoneyTree report. Still, 2019 saw the most $100 million-plus rounds ever with 213, raising $47 billion in 2019, the second-biggest year of mega-round funding.

U.S. technology initial public offerings fell for the second straight quarter, though year over year exits remain higher. In the fourth quarter, 20 U.S. VC backed companies had an IPO exit, compared to 22 in the third quarter. Overall, 90 technologies had IPO exits in 2019, compared to 86 in 2018.

And at the end of 2019, the U.S. has a record number of unicorn companies with 199 VC backed private companies valued at $1 billion or more, up from 149 at the end of 2018.

The Top 10 Venture-Backed Deals in Austin in 2019

Year Qtr Company Name Round Amount ($M)
2019 3 RigUp Series D 300
2019 4 SparkCognition Series C 100
2019 1 Siete Family Foods Growth Equity 90
2019 3 ScaleFactor Series C 60
2019 1 RigUp Series C 60
2019 1 Outdoorsy Series C 50
2019 2 EverlyWell Series A 50
2019 1 DISCO Series E+ 50
2019 3 TurnKey Vacation Rentals Series E+ 48
2019 2 FloSports Series C 47

Source: MoneyTree Report from PwC and CB Insights.