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Venture capital surges in Q2 in Florida and nationally, MoneyTree Report shows

  Money

South Florida health-tech companies Modernizing Medicine and Neocis led Florida venture capital deals in the second quarter.

By Nancy Dahlberg / ndahlberg@miamiherald.com

South Florida healthcare-technology companies led Florida venture capital deals in the second quarter, according to a MoneyTree report by PricewaterhouseCoopers and CB Insights released Wednesday.

Florida deals in the quarter were led by Boca Raton-based Modernizing Medicine’s previously reported $231 million mega-round by global private equity firm Warburg Pincus. Modernizing Medicine currently employs 550 people and is booking $100 million in annual revenue. “If there was any doubt that you could found and scale a company in South Florida, hopefully those doubts are now erased,” CEO and co-founder Dan Cane said when the funding was announced. “We are proud to call South Florida our home.”

Second in the state was Neocis, a Miami-based robotics company in the dental industry, with a $15 million round that included Mithril Capital Management of San Francisco, a venture firm led by Peter Thiel and Ajay Royan, and other undisclosed investors. According to Crunchbase, Neocis raised $2.4 million prior to this funding.

Neocis is focused on improving healthcare through robotic assistance. It manufactures and markets YOMI, a robot-assisted surgical platform for dental implant procedures. The company, led by CEO and co-founder Alon Mozes, announced it had received FDA clearance to market YOMI and that it had made its first couple of sales in March. “We look forward to further demonstrating the benefits of YOMI to the surgeon’s practice and their patients and to bringing the system to select key opinion leaders in the United States,” Mozes, a biomedical engineer, said in March.

Florida companies took in 16 venture capital deals worth $291.1 million in the second quarter, up strongly from $156.9 million in the first quarter and $85.7 million a year ago, according to MoneyTree data. Of course, South Florida firms accounted for more than 85 percent of the total, thanks largely to Modernizing Medicine. Still, the nation’s third largest state ranked 11th for venture capital in the quarter, for both amount of financings and number of deals.

In addition to Modernizing Medicine and Neocis, South Florida companies that received investment in the second quarter included human analytics software company Kairos, $5.73 million, in a round that includes funding from New World Angels, and DadeSystems, which provides accounts-receivable solutions and received $2 million from Ocean Azul Partners.

Nationally, venture capital rose to the highest level in a year as investors deployed $18.4 billion to U.S. VC-backed startup companies across 1,153 deals, up 28 percent in dollars but down 4 percent in deals from Q1 2017, according to the MoneyTree survey. This was helped by 31 mega-rounds of $100 million or more. Lyft’s $600 million round was the biggest deal of the quarter. MoneyTree Report results can be found at www.pwcmoneytree.com.

“Q2 was a tale of two trends,” said Tom Ciccolella, U.S. venture capital leader at PwC. “U.S. deal activity continued its multi-quarter downward trend, but the growth rate of investments in dollar terms accelerated from the first quarter. A surge in mega-found deals, to the second-highest level seen to date, helped drive a robust level of quarterly VC funding.”

This was the second venture capital report this week. Tuesday, data from the Pitchbook-NVCA Venture Monitor, which characterizes and compiles qualifying deals differently, showed that South Florida was No. 1 in the nation for exits in the second quarter -- thanks to Chewy's $3 billion-plus sale to PetSmart. 

Nancy Dahlberg: @ndahlberg

Neocis

Alon Mozes, left, and Juan Salcedo started the healthcare robotics company Neocis. They are shown with an early version of Neocis’ robotic guidance system for the fast-growing dental implant market, which received FDA clearance and is now being marketed. Both co-founders worked together at Mako Surgical before founding Neocis. November 2015 photo by Patrick Farrell/Miami Herald.

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