Cnet had an article yesterday morning about the Web 2.0 Boom and was questioning if it was over. They attributed this to the amount of Venture Capitol funding going into Web 2.0 companies in the Silicon Valley, and that the numbers of funding has slowed.
Web 2.0 deals in the Bay Area actually dropped from 74 deals in 2006 to 69 last year and investments were down 3 percent from the $431 million invested in 2006. It’s clear that the real growth in the Web 2.0 sector is happening outside of the Bay Area,” Jessica Canning, director of global research at Dow Jones VentureSource, said in a statement
So if the funding for Web 2.0 companies in the Bay Area has dropped, where is the money going to? Seattle of course. According to the Puget Sound Business Journal, Seattle is one of the nation’s largest growing areas for VC funding. According to the chart below the Pacific Northwest is ranked number 5 in amount of deals, but third in the amount of money invested for 2007 (7 deals and 105 MM more in funding than in 2006)
According to Seattle PI: The Pacific Northwest showed the fastest growth rate in investment dollars of the major venture capital regions.
I can definitely attest to the web 2.0 and funding activity taking place in the Seattle area. There are some incredibly bright and motivated people flowing out from Microsoft, Amazon and Experia and it’s only a matter of time before the next Facebook or MySpace or Web 3.0 company sprouts in Seattle. There are a lot of Round A funded startups with worlds of potential. I’d love to see a few of these guys hit it big.
Seattle is not the only city in the Pacific NW. Portland is also becoming a hotbed for technology startups. See http://www.siliconflorist.com for the latest news on the local tech scene.
You know what Dave. You are probably right. We’ve been hearing of some very cool tech companies in Portland, but could never justify a full recruiting resource devoted to the area (not enough activity in the area just yet). Where would you rank Portland in terms of technology activity – would you rank it there with Denver, Salt Lake City and Boise. Those are some of the other West Coast cities that come to mind after the big three of Seattle, Bay Area and LA.
Boris,
I am certainly not an expert on the size of the high-tech market here in Portland. I can tell you that the local tech scene is extremely active here. With events like IgnitePortland (http://www.igniteportland.com/), StartupPalooza (http://www.startupalooza.org/) and Portland Barcamp (http://www.startupalooza.org/) there is a (self?) conscious effort to create a lively tech community in Portland. I have attended a couple of these events and they have been full of energy and excitement. Does this translate into jobs? I don’t know. But I think it has to eventually.