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Massachusetts bests New York as center for venture capital

In the battle for the nation’s number two spot for venture capital, Massachusetts has recently been getting the best of New York.

In doing so, it has begun to look more like California, at least from a dollars-per-deal perspective.

At first, the number two deal-making crown generally belonged to more established Massachusetts. That is until 2014, when New York gathered steam and typically got the better of its more northern rival. From mid-2014 to mid-2016, New York came out on top more than 75 percent of the time.

However, in the past three quarters, Massachusetts has outspent its rival twice, and by a noticeable margin each time, according to data from the MoneyTree Report put together by PricewaterhouseCoopers and CB Insights. New York still has more deals.

This includes the third quarter of 2016 and the first quarter of 2017, when VCs in the state invested $1.8 billion, compared with New York’s $1.4 billion, the report shows. During the quarter, New York GPs sealed 58 percent more deals, 150 vs. 95.

That left the Bay State’s average deal size resembling that of California, the top state for venture investing. Average deal size in New York trailed considerably.

Over the past four quarters, the average deal in Massachusetts was $16.1 million, while in New York it was $10.4 million, data from the report shows. In California, the average deal size was $16.5 million.

Photo of Massachusetts road sign courtesy of Jill_InspiredByDesign/iStock/Getty Images