By Neal Bloom
As San Diego’s tech community continues to thrive, our region has become a growing focal point for investments. In fact, funding for local tech and life science companies has increased significantly this year.
So far in Q3, San Diego tech companies have raised $2.15 billion dollars. Funding has been dominated by massive biotech rounds, including $438 million by Samumed, $230 million by Gossamer Bio, $150 million by Rakuten Aspyrian, and $110 million by Tandem Diabetes in a post-IPO offering. These overshadowed additional strong biotech fundings of $60 million by Omniome, $45 million by biotech/tech in-between Cue, $26 million by Mistral Therapeutics, $15 million by Oncosec Medical, $12 million by Mesa Biotech, and $11 million by MabVax Therapeutics. This quarter alone of $1.2 billion is compared to 2017’s entire total of $1.9 billion.
Funding for local tech companies was also strong with $20 million by Inseego, $14.8 million from Anokiwave, and $10.5 million by SOCi. However, last year’s Q3 had more deals of this size compared to this year.
In comparison, in Q3 2017, San Diego companies had total funding of $426.5 million, including $114 million for Brain Corp. These included 39 total deals in San Diego, compared to 25 deals in Q3 2018. As the late Bruce Bigelow noted a year ago, this follows a continuing trend of larger deal sizes but smaller total amount of deals.
|Beauty Bakerie Cosmetics Brand||E-Commerce||7/9/18||$4.6M|
|Tandem Diabetes Care||Biotechnology||8/8/18||$115M|
Initial Public Offerings (IPOs)
While the first half of 2018 saw only one San Diego IPO (One Stop Systems), the second half is shaping up to be better. Already in Q3, five companies have filed or have already debuted on the market.
Crinetics – $102 million market debut on July 17
BioNano Genomics – $20 million market debut on August 21
Equillium – $86 million IPO filed on August 23
ChaSerg Technology Company – $200 million IPO filed on September 12
Ra Medical Systems – $50 million offering filed on July 30 and will debut the week of September 24
In Q3 2018, the acquisition of GreatCall for $800 million by Best Buy headlined the list. This was a much quicker than expected sale after the company was acquired by private equity fund GTCR only one year ago. Other notable acquisitions include Venato by crypto exchange Coinbase (amount not disclosed), LeaseLabs by RealPages for $100 million, and EvoNexus incubator grad Approved by Credit Karma (amount not disclosed).
San Diego’s tech community has certainly established itself as a major player in the tech industry with many success stories in various pockets of innovation. The region’s growing reputation for excellence in many tech sectors will no doubt bode well for our ecosystem. San Diego’s tech community will continue to mature as early stage companies become late stage through growth, companies get acquired, and founders become funders. While the biotech community continues to be strong, biotechs themselves are looking more like tech companies too with the hiring of developers and data scientists. Here’s to an equally strong fourth quarter as well.
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