Pratibha Sharan, left, and Anna Mamo, both MBA students at the University of Pittsburgh, were at the school's display Wednesday at the Three Rivers Venture Fair at PNC Park.
From left, John Hammer, chairman of Pi Capital Group; Anthony Florence, CEO and founder of ATHS; and David Jaffe, partner with Fox Rothschild LLP, were on hand at PNC Park on Wednesday.
By Deborah M. Todd Pittsburgh Post-Gazette
Angel and venture capitalists converging on PNC Park for the Three Rivers Venture Fair are following a five-year trend that shows Pittsburgh has been a solid bet in an unstable economy.
A report released Wednesday by New York-based accounting firm Ernst & Young LLP and South Side-based seed stage investor Innovation Works notes the Pittsburgh region saw increased deals and investment during a time when both were stalling nationwide.
In 2012, the number of venture deals nationally declined 6 percent and the number of dollars invested dropped 10 percent, from $29.5 billion the previous year to $26.5 billion last year. But the Pittsburgh region saw a 54 percent increase in the number of investment deals and a bump up in investments from $326.9 million in 2011 to $329.1 million in 2012.
From 2008 to 2012, the region saw $1.3 billion in early-stage technology investments and nearly doubled the number of investments for very-early-stage companies. Between 2011 and 2012, 28 regional companies made exit deals worth $2 billion in disclosed value.
That sounded pretty good to tech entrepreneurs who gathered at Wednesday's kickoff of the Three Rivers Venture Fair, as they look to snag investors.
The two-day fair presented by the Pittsburgh Venture Capital Association has drawn more than 600 investors, entrepreneurs and tech stakeholders. The schedule of events includes formal pitches by all 39 participating tech companies; a University Technology Showcase where companies spun out of Carnegie Mellon University or the University of Pittsburgh are being highlighted; and panel discussions for early- and later-stage investors.
The fact that several investors came from top-tech regions shows that Pittsburgh's opportunities are no longer under the radar, said Pittsburgh Venture Capital Association President Kelly Szejko.
"If quality companies are created, someone will always fund them. And I think the fact that we're getting attention from [investors] from California, New York and Boston shows the word is getting out about the quality of Pittsburgh's companies," she said.
Over the past 10 years, the Three Rivers Venture Fair claims to have helped participating companies raise more than $400 million in investments.
Jim Kaiser, CEO of Cleveland-based insurance adjustment software company Casentric LLC, came for networking opportunities and a chance to formally present his business plan to investors. He is seeking $1.25 million for marketing and to commercialize the product.
"It's great to see the local community is upstaging some of the more traditional venture capital sites," he said.
South Side-based drug discovery technology company Sharp Edge Labs is seeking $2 million to fund capital expenditures. Scott Sneddon, the company's CEO and one of 14 entrepreneurs who presented during the fair's "Shark Tank" University Technology Showcase, said he wasn't surprised by Ernst & Young's findings.
Mr. Sneddon, a Boston native who spun his company out of Carnegie Mellon University in 2011, said he has seen dramatic improvement within Pittsburgh's tech community since moving the company from Boston in November. He said a new sense of innovation combined with a better grasp on commercialization is attracting investors more than any other factor.
"It's not a cool idea because it's Pittsburgh or CMU technology. It's because people have figured out how to actually turn the ideas into businesses. The entrepreneurs themselves have become more sophisticated," he said.