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March 4, 2024

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W W W. M A I N E B I Z . B I Z 15 M A R C H 4 , 2 0 2 4 F O C U S L I F E S C I E N C E S / B I O T E C H With around $15 million raised so far, including $13 million in equity, Donnelly is now seeking $7 million to $8 million in venture capital and strategic funding for the 50-employee startup he co-founded in 2015 with microbiologist Julie Morrison. He's doing so follow- ing a three-year slump in nationwide venture funding, culminating in a 42% drop last year to $248.4 billion, the lowest since 2017, according to a January report by CB Insights. U.S. venture capital transactions also sank to a 10-year low in 2023 as investors shied away from large, late-stage funding rounds and venture-backed IPOs fell to their lowest level in a decade. Another study, by commercial real estate company Cushman & Wakefield, shows a funding slump in life sciences, covering fields including biology, pharma- ceuticals, biomedical technology and nutraceuticals. Last year alone, U.S. venture funding for life sciences dropped 28% to $26 billion amid higher interest rates and economic uncertainty, even though pharmaceutical companies posted a record $1.5 trillion in global revenue and mergers and acquisitions boomed. But even in good times, early-stage Maine life sci- ences and biohealth startups frequently have to work harder than their peers in bigger markets to woo inves- tors from out of state. "We've had some wild success stories like Covetrus and IDEXX, some really big home runs, but we don't have a lot of density in the state of companies of that level" to appeal to investors in Boston and other big VC markets, says Tom Rainey, executive director of the Maine Center for Entrepreneurs, which runs several business incubator programs. "If Maine is going to be a player in the bioscience space, we need to create a lot more density." VC's $300 billion 'dry powder' Signs point to a modest comeback in venture capital funding this year. "In 2024, companies that meet investors' key invest- ment criteria, including successful progression in clinical trials and financial discipline, will attract funding," says Sandy Romero, Cushman & Wakefield's New York- based global research manager. "Overall funding should be slightly higher this year given the strong clinical trials pipeline and significant dry powder available to inves- tors." She estimates spending power of around $300 billion, of which $46 billion could be allocated to life sci- ences deals which typically account for 16% of the total. However, she says that higher interest rates and tighter credit markets have made investors cautious in the short term, especially in response to shocks like last year's failure of Silicon Valley Bank that roiled markets. A/Z Corpora� on is an industry-leading construc� on services provider with an extensive por� olio in the life sciences industry. We have been a part of the Cianbro family of companies since 2019 and are pleased to announce that A/Z and Cianbro's ver� cal construc� on management team have combined forces and integrated into one focused team: A/Z Corpora� on – A Cianbro Company. Together, we are partnering with our clients to provide best-in-class: Design & Engineering Preconstruc� on Design-Build & EPCM CM/General Contrac� ng Self-Perform Trades Energy Management LIFE SCIENCES HEALTHCARE HOSPITALITY ACADEMIC ADVANCED TECHNOLOGY & MANUFACTURING CORPORATE & NON-PROFIT UTILITIES MISSION CRITICAL DISTRIBUTED GENERATION Building More Together To learn more, visit a-zcorp.com C O N T I N U E D O N F O L L OW I N G PA G E » P ROV I D E D P H O T O When economic uncertainty abates, look for life sciences investment to rebound. — Sandy Romero Cushman & Wakefield

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