Arizona VC hits two-year high

Venture capital investment in Arizona followed national trends by rising to a two-year high in the second quarter, when three Arizona companies, including a Tucson-based biotech firm, secured funding of $48.4 million, according to a MoneyTree Survey covered by the Arizona Republic.

The survey, conducted by PricewaterhouseCoopers, Thomson Venture Economics, and the National Venture Capital Association, showed that the total amount raised by AmpliMed Corp. and two other Arizona companies tripled the first-quarter mark and exceeded all quarterly performances since the third quarter of 2002.

AmpliMed Corp., a pharmaceutical firm founded by senior faculty at the Arizona Cancer Center, will use its latest $9.2 million funding to continue work on chemotherapy and other anticancer drugs.

The other two companies, both based in Tempe, are Tectura, an information-technology corporation looking to expand into other markets, and O2 Science Corp., a health care company that will use its first round of funding to develop respiratory devices.

In the first half of this year alone, Arizona nearly met its total venture capital investment from the previous year, raising $62.7 million in the first and second quarters to last year's $66.3 million. In the second quarter, Arizona's percentage of national venture capital more than doubled its mark from the same period last year.

Generally considered too risky for bank loans, start-up companies with promising innovations can acquire VC investment to grow, and later bring the economic returns from their technologies back to the state.

Arizona's sunny venture capital numbers were in sync with national trends; the U.S. also posted a gain from $5 billion in the first quarter to $5.6 billion, the highest since 2002.

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For more information:

"Arizona companies net $49 million in capital funding," Business Journal, 08/09/04

"3 Ariz. firms land $48 million in risk capital," Arizona Republic, 07/27/04

AmpliMed Corporation