North Texas appears to have been home to the largest venture capital deal in Texas during the second quarter. But the company involved in the state’s top VC transaction has since up and left the community to re-establish its headquarters in Silicon Alley.
In the second quarter, US HealthVest LLC, previously of Fort Worth but now of New York, raised $59 million to support the development of its hospitals, which specialize in psychiatric and substance abuse services. The news comes from the latest MoneyTree report from PricewaterhouseCoopers and the National Venture Capital Association, based on data provided by Thomson Reuters. The former Cowtown-based startup received investments from venture capitalists including Oak HC/FT, Polaris Venture Partners, and F-Prime Capital Partners. The deal represented 81 percent of all investments in North Texas companies during the quarter.
Sources at Thomson Reuters believe the company completed the raise while in Fort Worth, then relocated to New York. A document filed with the Securities and Exchange Commission in March 2013 lists the company at 500 Bailey Ave. in Fort Worth. The next document filed in April 2015 lists US HealthVest at a New York address.
US HealthVest has not yet responded to multiple requests for clarification.
“Typically, companies tend to move shortly after closing a new round, not before,” an emailed statement from Thomson Reuters said.
Meanwhile, North Texas startups raised a total of $72.6 million in the second quarter, representing the largest second-quarter total since 2008. Last year, local companies attracted $37.7 million in the same time frame.
“It’s a pretty picture for this year,” said Caroline Gagliardi, partner at PwC, adding that 2016 investment numbers for the region are strong. “We [already] have 82 percent of the total dollars we raised in 2015.”
Ten startups in North Texas secured deals during the quarter. Media and entertainment startups landed three deals, with software and healthcare services industries representing two deals, respectively. The remaining three deals went to startups within consumer products and services, industrial/energy, and networking and equipment.
Following US HealthVest, North Texas companies raising the most money during the quarter were Plano’s Ifountain LLC, which landed $10 million; Frisco’s Valify LLC, which secured $2 million; and Catapult Health LLC, which attracted $1.4 million.
North Texas’ second-quarter numbers follow a strong first quarter, when venture capitalists invested $136.4 million across 24 deals.
Startups in Texas raised $255.6 million in the quarter, as compared to $220 million raised in the same quarter last year. Austin startups raised a total of $162.8 million in the second quarter. Houston companies raised $21 million, and San Antonio startups secured $10.1 million.
The story of North Texas venture capital investments could be characterized as cyclical and less stable than that of Austin, Gagliardi said.
“It’s not like we have a ton of deals, so any one deal can sway the numbers,” Gagliardi said. “Every deal is really important to the story.”
Nationally, Uber Technologies in San Francisco landed the top deal in MoneyTree history in the second quarter. The ride-sharing app raised $3.5 billion from Saudi Arabia Public Investment Fund.