Deal sizes soar as seed funding continues to heat up in Q1

Dollars don’t lie, and if Q1 is any indication, the trend of rising venture capital investments in New York will likely continue in 2019. While deal count was slightly down from last quarter (41 deals, down 10%), total funding hit $87.7MM, a 7% increase from Q4 and a remarkable 119% increase year-over-year. This is the largest sum we’ve seen since Q1 2016, when seed activity in NYC reached $113 million from 74 rounds.

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More funding / fewer deals = bigger rounds. The average round size was $2.1MM, up 17% from last quarter and up 21% compared to 2018’s average. We even had to make a change to how we classify seed deals, as 7 deals this quarter went above the $3MM mark.

CLICK HERE FOR THE FULL BREAKDOWN OF Q4 DEALS AND TRENDS

The Primary NYC Seed Deal Report covers all NYC seed deals—defined as $250K–5MM—that have been publicly announced in each quarter. Data is sourced from Crunchbase, CB Insights, and Primary Venture Partners research. If you know of any deals that we’ve missed in this report, please contact us at info@primary.vc!

Industries to Watch

A fertile market

In the past few quarters, we’ve seen both coasts announce funding round after funding round for companies in the fertility space… well, things aren’t slowing down. In Q1, NYC-based companies Dadi (DTC sperm storage) and Oova (home testing kits for fertility) entered the race with their own unique takes on this growing market.

It’s an IoT world

Two out of the three largest NYC seed rounds in Q1 came from the IoT world, where next-gen cycling computer company Hammerhead raised $4.2MM (led by Primary) and home IoT cybersecurity company, Firedome, raised $4.5MM.

Making the world a better place

VCs backed a few companies focused on global positive change. Kindred (a Primary portfolio company) is looking to accelerate social movements through their "Davos for Influencers" event in 2020, while Move This World is bringing social-emotional learning programs to schools, and By Humankind is looking to eliminate plastics in our daily CPG products.

Performance reviews get popular

The rise of D2C companies has led to an overabundance of consumer products, and the pressure’s on for brands to constantly iterate. Companies like Perksy are tapping into this trend and rethinking how market research is done by connecting brands directly with end consumers. On the consumer side, customers continue to look for solutions to deal with the paradox of choice, and companies like Supergreat emerge to fill this need.

Serving SaaS

The rapid influx of SaaS applications has created internal chaos. Whether its tracking and managing spend or consolidating fragmented data, companies are emerging to help enterprises get a handle on the tools used by their employees.

Primary NYC Seed Deal Report: Q1 2019

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