Bay Area seed funding appears to be on track for another banner year. Seed deals highlight the shift to mobile as 2013 is seeing massive increase in mobile deals and contraction to the online sector.
The Series A Crunch can go to hell at least in the San Francisco Bay Area where seed-stage investment activity looks like it will hit record levels in 2013 if it continues its current pace.
In H1 2013, seed funding to companies in the region which encompasses both San Francisco and Silicon Valley topped $192M across 242 deals. This is already more than all of 2010 and nearly comparable to 2011 investment funding and deal levels. Seed financing in the Bay Area has grown steadily over the past three years and is on pace for another record year if the current pace continues (as shown below).
As we look at the seed funding by sector, we see a bit of a shift in where seed funding is going. The Bay Area seed investment picture to the internet sector is a bit mixed. Though Bay Area Internet seed deals look poised to top 2012’s record numbers, the current run rate suggests that funding to seeded companies may dip from 2012. On a sequential basis, seed funding in the Bay Area jumped 54% from 2010 to 2011 and 74% in the following year, as shown below, but barring an influx of seed deals in the 2nd half of 2013, it looks like the internet sector will see less funding in 2013 than 2012.
Mobile seed funding in the Bay Area, however, is a different story. After a modest increase in dollars between 2011 and 2012, mobile seed dollars in the Bay Area in H1 2013 have already doubled 2010 levels and are already at 75% of the funding levels seen in all of 2012. Deal activity also appears on track to continue its steady growth trend.
Below is a list of the most active seed investors since 2010 based on unique company investments in the Bay Area. The top 10 is led by SV Angel, followed by Andreessen Horowitz, Google Ventures and a mix of of both larger multi-stage venture capital firms and pure play early-stage/seed funds (who are on track for their own seed fund crunch in the coming years). The list has omitted individual investors or seed accelerator programs including Y Combinator and 500 Startups (however, seed financings by these respective investors are included in the above data.)