Visualizing startup deals in the Portland OR Metro Area to understand how investment in the area is changing and how we compare to the rest of the PNW.
Of note: CrunchBase was our primary data source for this study. At some point we’d love to incorporate data from AngelList and other sources. See notes at the bottom for thoughts on completeness / accuracy of the data
We have a startup scene here in Portland.
This isn’t news to anyone who lives and works here. But it is something new that I’m finding in my anecdotal sampling of the collected consciousness of Silicon Valley: Other people know about us, too.
When I mention to someone in the Bay Area that I live in Portland, I’ve found that I no longer expect a dismissive comment along of the lines of ‘Portland, that’s where 30-somethings go to retire, right?’
Instead, many of the responses over the last year or so have morphed into something more like ‘Oh, New Relic has an office there, right?’ or ‘Yeah, I’ve heard of Puppet Labs and a few other startups there’.
To celebrate next week’s Portland Startup Week, I thought it would fun to share some research on Portland’s burgeoning startup scene, and see if we can learn something about what’s going on investment-wise here in Portland.
First off, here is total startup investment by year, broken down by what CrunchBase calls Round Type:
2011 aside, the trend looks great here. Portland companies are attracting much more venture investment than five years ago, and other investment categories are starting to make significant contributions as well.
Next I wanted to look at just Series A rounds. At the point where an A round is raised, there are usually a few things present: The team has been fleshed out, there is demonstratable potential for growth, there is a defensible differentiator, and product-market validation has happened. It’s a great indicator of startups finding traction and investment money rewarding that traction.
Here’s what Series A activity by year looks like for Portland startups:
Series A activity looks a lot like what I’m experiencing anecdotally: Growth. A steady increase through 2013, then big growth in 2014. Things are heating up in this town!
(Those of you familiar with the Bay Area startup scene might be shaking your head right now. Even though we’re seeing amazing growth in startup funding here in Portland, $30m in *total* Series A funding for a metro area is pretty small potatoes relative to the Bay Area. Just between you and me, I think our relative laggard status represents a huge opportunity for everyone here, investors and founders alike)
Finally, I looked at how Portland is doing relative to our region. Now, before I go on, let’s just say for those who aren’t familiar with our area that there is an, uhm, healthy rivalry between Portland and Seattle. A rivalry that might be best expressed in sporting events, but that includes anything and everything that both cities do well, from coffee and beer to tech.
And as far as startup investment goes, I hate to say it, but Seattle is whooping on us just a bit:
The data for that pie chart actually comes from three different sources: From PitchBook, whose research shows a total of $2B invested in the region in 2014. From CB Insights, whose data reveals that $1.5B of those investments went to Seattle-area companies. And finally, from the CrunchBase dataset referenced in the rest of this post.
A word about accuracy: This research is as accurate as CrunchBase is. In terms of dollar value, I feel like we’re pretty close: We have the $2b in PNW funding reported by PitchBook. We have the $1.5b in Seattle reported CB Insights. Leaving $500m to be split amongst the rest of Washington, Oregon and Idaho. Portland capturing half of that passes the sniff test to me.
What I do feel is missing here I believe are seed and angel deals. The PitchBook report shows Portland Seed Fund involved in 114 deals in 2014. CrunchBase only contains 72 investments *total* for Portland Seed Fund, ranging back to 2011.