The chief executive officer of TechPoint, the state’s tech accelerator, may be understating the success the industry is enjoying at the midway point of 2021. “A tremendous start to the year,” said TechPoint CEO Mike Langellier in an interview with Inside INdiana Business, referring to more than $400 million dollars in investments have been made by venture capitalists and equity firms in Indiana tech companies during the first six months of the year.
“We’re only halfway into the year and we’ve already broken 2019 record of $358 million. And that was for the year,” said Langellier.
In 2020, the pandemic put a damper on investment, as tech companies in the state recorded $174 million. TechPoint’s analysis is based on publicly available data.
The growth accelerator says individual big investments account for much of the tally. For instance, Indianapolis-based Greenlight Guru announced in June a $120 million investment and Indy-based OnBoard recorded a $100 million.
Both investments were made by growth equity firm JMI Equity, which is based in Baltimore. “JMI Equity has been tracking and investing in companies here for the past five years. They invested in HealthX in 2017 and most recently in Bloomerang at the end of 2020. They are also investors in UKG, which has a large presence here in Indianapolis. They clearly see the value of the Indiana tech ecosystem,” said Roger Shuman, TechPoint’s relationship manager.
Langellier says the $400 million mark does not include the $240 million investment announced in April by Chicago-based ActiveCampaign, which has a expanding staff in Indy and will use some of the investment to grow its Indiana footprint.
While the big, single capital raises capture the headlines, Langellier says Indiana’s tech sector is also seeing numerous, smaller investments. “We’ve already had 41 capital raises. So, if the path continues, we would break the record for quantity of deals in 2021, as well,” said Langellier.
In comparison, during all of 2020 TechPoint recorded 73 deals. It measured 47 deals in 2019, which had been a record year of total dollars invested.
TechPoint will release its second quarter venture capital report in the weeks ahead, but Langellier expects Q2 will be the biggest quarter for tech investments since TechPoint started keeping track in 2014.
“Your large investment amounts are not just vanity numbers. What it also signals is that it speaks to a big market opportunity,” said Langellier. “VCs don’t make those kinds of investments that they don’t see a big market opportunity. And so, that’s a positive sign.”
Langellier said the investments also speak to the ambitions of company executives who are sending out signals that they are chasing a big future for the company.
In an interview with Inside INdiana Business reporter Wes Mills, Langellier explained what it takes to keep the momentum going.