Cleveland tech companies attracted venture and angel investments in 2013 amounting to pre-recession levels, according to JumpStart and a report released by the Venture Capital Advisory Task Force. One hundred and eighteen companies spanning IT, healthcare, clean tech, and business and consumer products received $259 million in equity investments last year, a 15-percent increase over the previous year.

“$259 million puts us up where we were pre-recession,” says JumpStart’s principal of communications Samantha Fryberger. “So that’s really good.”

IT companies led the way in investments. Sixty-six IT firms attracted $116 million, followed by 32 healthcare companies bringing in $98 million, and 15 clean technology businesses getting $44 million. Consumer products raised $1 million.

Furthermore, 27 of the investors were first-timers to the Northeast Ohio business community. “Year after year, there are investors finding we have great companies here,” says Fryberger. “More than 50 percent of the companies had angels involved in their deals, which means there are wealthy investors here who see good deals and want to put their dollars into these promising businesses.”

Seed companies fared well, securing 60 percent of the $259 million, according to the report, while companies in the early stages of growth followed the national trend and did not fare as well in Series A funding. Fryberger attributes the number of accelerators in the area fostering early business as one of the reasons seed funding was up. “We have more seed companies than ever before,” says Fryberger.

The news overall is good for growing companies in the area. “There’s certainly a great deal of entrepreneurial activity in Northeast Ohio,” notes Fryberger. “While a national shortage of Series A dollars could make fundraising more of a challenge for early stage businesses in the year ahead, it’s exciting to see new startups getting off the ground and some of the more mature companies attracting the capital they need to expand their market share.”

Source: Samantha Fryberger
Writer: Karin Connelly