Q1 Venture Funding Soars to Record Level

According to an analysis by Ernst & Young, venture funding in the U.S. hit $64 billion in the first quarter 2021. This is the highest quarterly amount in history and was roughly equal to 43% of all venture money raised in 2020. This milestone came during a period that economy-watchers were writing off due to the disruptions from COVID-19.

2021 Starts Out with a Bang

While 2020 was a boom year for the technology industries, the first quarter of 2021 found that money was pouring into food delivery companies, online brokerages, and Elon Musk’s SpaceXi. As is the way with venture capital, it is moving from slower growth to new and rapid growth businesses. Expectations are for a fourth straight year of $100 billion + in venture funding. First quarter venture funded companies included:

  • SpaceX
  • UiPath
  • Cruise
  • Gopuff
  • ElevateBio
  • Sila Nanotechnologies
  • Databricks
  • Thrasio
  • Stripe

There were 183 venture deals of at least $100 million in Q1 2021. The largest was Cruise’s $2 billion in funding led by Microsoft and General Motors, the majority owner of Cruise.

The pandemic did not seem to deter a blazing pace of IPOs in 2020, including Snowflake, Doordash, and Airbnb. Digital convenience store Gopuff raised $1.15 billion in March. Cloud data analytics software vendor Databricks raised $1 billion in the period. Investing app Robinhood also raised $1 billion, which needed liquidity after wild trading in GameStop left the company in a cash crunch.

There are Many More Small Deals than Big Ones

If your small business could benefit or grow with venture funding or other entrepreneurial loans, it may surprise you to know just how many resources there are. Many are on a local level with a goal of helping small and startup businesses in their locality. A quick search online for small business funding resources should yield something in your local area.

As an example, a search turned up on the first page of results a community college in Texas that has their own funding program. The Tarrant County College is a two-year accredited school. To help you to see how you may have access to local funding, programs are out there and here is how the TCC program works.

The program is called the Everyday Entrepreneur Venture Fundii. The program provides grants, loans, mentorship, and advisory services to small and startup businesses. From the website, here are the requirements to qualify:

Applicants must be Tarrant County residents and need to provide:

  • A business plan, including feasibility and financial projections of 1-2 years
  • Proof that a legal business entity (LLC, S-Corp, C-Corp or non-profit) has been formed
  • Proof that a commercial bank account has been opened
  • A current resume and two letters of reference
  • A cover letter outlining the following:
    • The request for funding
    • How funding would be allocated
    • A stated commitment to attend TCC’s educational workshops for entrepreneurs/small businesses for 12 months following receipt of funding
    • A stated commitment to actively participate in TCC’s Everyday Entrepreneur Venture Fund mentorship program

The applicant must have a website or wireframe for one coming soon and provide a 3-minute or shorter video to pitch their concept.

The important takeaway is not this school or program, but the fact that a little bit of research should turn up opportunities for your business in your area. If you need venture funding, it is out there for you.

i Venture funding soars in Q1 of 2021, CNBC.com

ii Everyday Entrepreneur Venture Fund, TCCD.edu

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