St. Louis VC landscape sees progress, challenges

Venture capital funding for startups in the St. Louis region has made considerable strides in recent years, with the metro area ranking fourth among Midwestern markets for total dollars invested between January 2015 and July 2017, according to data from the website Crunchbase and the investment firm M25.

After attracting $96 million in venture capital annually from 2005 to 2012, the area has averaged $342 million per year since.

Still, some concerns persist for the area’s venture investment scene, according to a new report from the St. Louis Regional Chamber. Those issues include:

    • A two-thirds decline in the number of local companies raising money since 2015
    • Swelling deal sizes, from an average of $2 million in 2012 to a mean of $7 million last year
    • Fewer seed-stage deals

Andrew Smith, vice president for entrepreneurship at the chamber, said the area needs to find a balance between smaller deals for early-stage companies and larger rounds for more established firms.

Still, Smith said, he’s bullish on the area as a hub for venture investing, and he aspires for St. Louis to compare to places Austin and Denver, rather than regional rivals like Kansas City and Indianapolis.

Read more: St. Louis Post-Dispatch

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