VC Investments in Boston Companies Soar to 1999 Levels ($1B+); Here Are the Top 10 Deals from the 2nd Quarter

Boston-area venture investing is starting to look a lot like 1999.

That’s my take from crunching the regional numbers in the latest MoneyTree Report, prepared by the National Venture Capital Association, PricewaterhouseCoopers, and Thomson Reuters. The Boston stats are in rough agreement with the national trends reported by my colleague Bruce Bigelow, but they are more pronounced in terms of growth.

The report says venture firms poured $1.06 billion into 96 Boston-area companies in the second quarter of 2011 (April through June). That’s almost double the dollar amount from the previous quarter ($553 million in 69 deals), and the most since the first quarter of 2001—remember those days?—when $1.37 billion was invested in 135 Boston companies. But perhaps the most historically similar quarter was the third quarter of 1999, when dollars invested topped $1 billion for the first time, peaking at $2.39 billion in the first quarter of 2000. Most of us remember what happened from there.

The biggest Boston deal of the last quarter was the $165 million growth round invested in Boston e-retailer CSN Stores by Battery, Great Hill, HarbourVest, and Spark Capital. Most of the other notable deals were in biotech and life sciences. The biggest was the $77 million Series G financing round for Merrimack Pharmaceuticals of Cambridge, MA. General Compression, an energy storage firm in Newton, MA, also raised a large round. No social media companies in the top 10, but consumer Internet and security were represented in the tech arena.

Here are the 10 biggest venture deals for Boston-area companies from the second quarter of 2011 (according to MoneyTree, with links to our related coverage; in some cases the financing amounts don’t agree, because of tranches and book-keeping, or else somebody be lyin’):

1. CSN Stores, $165 million

2. Merrimack Pharaceuticals, $77 million

3. General Compression, $54.5 million

4. Tesaro, $40 million

5. Blueprint Medicines, $40 million

6. Zafgen, $33 million

7. Verdasys, $28.9 million

8. Lotus Tissue Repair, $26 million

9. Proteostasis Therapeutics, $25.6 million

10. InfraReDX, $24.2 million

Author: Gregory T. Huang

Greg is a veteran journalist who has covered a wide range of science, technology, and business. As former editor in chief, he overaw daily news, features, and events across Xconomy's national network. Before joining Xconomy, he was a features editor at New Scientist magazine, where he edited and wrote articles on physics, technology, and neuroscience. Previously he was senior writer at Technology Review, where he reported on emerging technologies, R&D, and advances in computing, robotics, and applied physics. His writing has also appeared in Wired, Nature, and The Atlantic Monthly’s website. He was named a New York Times professional fellow in 2003. Greg is the co-author of Guanxi (Simon & Schuster, 2006), about Microsoft in China and the global competition for talent and technology. Before becoming a journalist, he did research at MIT’s Artificial Intelligence Lab. He has published 20 papers in scientific journals and conferences and spoken on innovation at Adobe, Amazon, eBay, Google, HP, Microsoft, Yahoo, and other organizations. He has a Master’s and Ph.D. in electrical engineering and computer science from MIT, and a B.S. in electrical engineering from the University of Illinois, Urbana-Champaign.