Venture capital firms again invested less in the third quarter but still pledged more than $10 billion for the 11th consecutive quarter.
In Minnesota, the firms invested $80.5 million in five companies, led by later-stage funding for three medical device firms: CVRx Inc., Torax Medical and Rotation Medical.
Overall, the venture capital companies invested $10.6 billion on 891 deals in the third quarter, down 32 percent from the $15.6 billion invested in the second quarter, according to a MoneyTree report from PricewaterhouseCoopers. Deals were down 11 percent.
The second quarter was dominated by two megadeals — Uber and Snapchat.
“If you look at Q2, there were two deals that made up $4.8 billion,” said Greg Vlahos a national venture capital partner with PwC. “You take that $4.8 billion out, and we’re pretty close to last quarter.”
The more interesting trend to watch, Vlahos said, is the number of deals per quarter.
This is now the sixth straight quarter of declining numbers in that category since a peak of 1,234 deals in the second quarter of 2014.
“We are seeing a decline in the number of deals, which indicates that we are having larger rounds going to fewer companies,” Vlahos said. “Its something to keep our eye on quarter-to-quarter on the national level.”
In Minnesota, a ninth round of funding for Brooklyn Park-based CVRx, which makes a treatment for high blood pressure and heart failure, attracted $46.5 million. A ninth round for Torox Medical in Shoreview, which makes treatments for digestive, incontinence and obesity disorders, attracted $25 million. Plymouth-based Rotation Medical, a developer of treatments for rotator cuff disease, raised $8 million.
Minneapolis-based Gravie Inc., which helps employers and individuals select and buy health insurance, raised $1 million.
Modus Engagement Inc., formerly known as App Data Room, had an undisclosed first round of funding from Sopris Capital LLC. The Minneapolis-based company has developed a mobile sales enablement platform that helps global sales and marketing teams manage and share their content.
Nationally, the number of first-round pledges remained strong, with $1.5 billion going to 259 deals. First-time funding accounted for 15 percent of the overall investments and 29 percent of the deals in the third quarter.
“That shows a lot of confidence in the venture-backed market,” Vlahos said.
Vlahos said VC firms also did a good job in the quarter raising money from institutional investors, endowments and large family offices by raising $11.1 billion in the quarter for their funds.