Wednesday 03 April, 2013
In 2012, USA Today lauded Denver as one of the top choices for tech start-ups. One reason is its venture capital scene. While the Rocky Mountain Front Range isn’t swarming with VC firms like Silicon Valley, it’s getting increasing attention in recent years for its growing venture capital scene and the innovative way it works.
Local Funding for Local Companies
For most of its history, Denver companies got the funding they needed from east and west coast venture capital firms. But that changed during the dotcom boom when nationwide venture capital firms began moving into the area and local firms began starting.
Once the dotcom boom went bust, many of these firms disappeared. But in recent years, we’re starting to see them again. In 2012 alone, Denver start-ups earned around $560 million in venture capital and it’s expected to be even more for the coming years.
Recovering from the Recession
As Denver recovers from the nationwide recession, the venture capital scene is gaining momentum again. For the last few years, Boulder has been a leader in start-up funding. It still leads the state in local venture capital firms, but Denver and its surrounding suburbs appear to be catching up. The low cost and availability of commercial real estate space in the Denver suburbs are attracting companies like early state startup VC firm Access Venture Partners, located in the northwestern suburb of Westminster.
As a sign of how things are going, some Boulder VC firms are even moving to the Mile High City. One company that has made this move is the Colorado office of Square 1 Bank, a company based in Durham, North Carolina.
Creating a Venture Capital Community
Aside from the increasing number of VC firms, there are other signs of growing momentum. 2012 saw the first annual Denver Startup Week. It included six days of events, networking, mentoring and more. The first Denver Startup Week attracted 3,500 attendees, which was three times what the organizers expected, and the 2013 event is expected to be even bigger.
What makes Denver’s VC scene truly innovative is that firms are working together to provide startups the funding they need. In the early months of 2013, Galvanize launched its gSchool web development program, a collaborative working space designed to create a community for businesses in the early stage of their development.
What’s different in today’s venture capital scene is that instead of isolated firms working in competition with each other, they’re working together to provide more funding, realizing that what helps the city’s economy helps everyone in it. This, along with Denver’s pro-business city government and the relatively low cost of operating in Colorado, makes it an attractive location for startups.
Today, over 500 companies call the city of Denver home. As the venture capital scene in Denver grows in momentum, we can expect to see startups in the city grow and thrive.