The nation’s “mighty middle” has been a rapidly expanding sector for businesses in the tech industry lately, and just-released data from the first quarter of 2021 bore this trend out.
According to the Q1 2021 PitchBook-NVCA Venture Monitor, the markets of Denver and Chicago led the nation with the highest year-over-year growth in venture capital deals during the first quarter of 2021 among the 10 largest tech hubs the report included.
The report also highlighted several trends that helped shape the U.S. tech industry as a whole over the past few months. Nationwide VC investments for the quarter totaled $69 billion, an increase of 92.6 percent over the same period last year. A total of 141 mega rounds of $100 million or more were responsible for $32.7 billion in investment alone, and the special purpose acquisition company (SPAC) space is also booming. All told, the nationwide venture industry is off to a record-breaking start this year.
In the city of Denver, a total of 98 funding rounds were closed in Q1 of 2021, up 14 percent from last year. With a total of $1.2 billion in funding, this market saw positive growth of 264.8 percent in the VC sector. During this period, several new unicorns made their way onto the Colorado tech scene with nine-digit funding rounds across a variety of industries. One of which was healthtech company DispatchHealth.
As we’re nearing the latter end of the COVID-19 pandemic, it comes as no surprise that the healthtech field has been bustling. Last month, DispatchHealth closed on a $200 million round for its on-demand medical care services. The Tiger Global-led funding boosted its valuation to $1.7 billion. Denver-based Strive Health, which offers a kidney care platform, brought in a massive $140 million Series B round led by Alphabet’s CapitalG fund that more than doubled its funding raised so far.
Growth doesn’t stop there for Denver-area tech startups. In January, Greenwood Village-based pax8 announced it planned to expand its platform following a $96 million raise. Catalyst Investors and Sageview Capital led the round that’ll help the startup grow its team and expand its cloud marketplace tech.
Windy City tech companies have been on a roll as well. The same PitchBook report recorded 82 venture funding deals closed during Q1 2021. While this number didn’t change from last year, the value of those deals totaled $2 billion. That number is up 331.2 percent over Q1 2020. One of the biggest players here is new unicorn, Cameo. The video marketplace company saw tremendous growth over the past year.
Cameo raised a $100 million Series C last month to fuel the growth of its platform that allows users to commission personalized videos from celebrities. The platform has surged in popularity in the pandemic as it helps some artists stay busy, and helps fans stay upbeat amid COVID-19 mitigation measures forcing people to stay indoors. Now, the startup is looking to increase its headcount, and it isn’t the only one. Logistics company FourKites raised a Series D of the same amount to scale as it comes off a year of its own substantial growth.
With the largest Chicago tech round of the quarter, ThoughtWorks pulled through with a $720 million mega-round to help companies along their digital transformations. The unicorn’s valuation is now $4.6 billion following its latest investment from names including GIC, Siemens AG and Fidelity Management.
