Worcester Business Journal

14 Worcester Business Journal | March 10, 2025 | wbjournal.com F O C U S B A N K I N G & F I N A N C E PHOTO | EDD COTE Competing for world-class capital BY ERIC CASEY WBJ Managing Editor I t was once common business wisdom that you had to be in either San Francisco, Los An- geles, New York City, or Boston to successfully attract venture capital for a startup. ese four metropolitan areas still play a prominent place in the venture capital world, with more than half of all deal value in 2023 originating from those cities, according to the National Venture Capital Association. But with the COVID-induced move to virtual meetings now part of the new normal, growing cities like Worcester have been able to establish a more secure place in the startup landscape. With the creation of the Wire Group in 2022, a Worcester-based angel in- vestor group focused on boosting local ventures, and the January launch of Auxilum, a downtown Worcester startup hub providing funding to participants, figures who are familiar with the local startup scene feel the city is becoming a smart place for emerging companies. "Worcester is a premium location now for startups," said Jon Weaver, president and CEO of the Worcester life sciences incubator Massachusetts Biomedical Initiatives. "It was a major shi in the world as Zoom became more prevalent. at made it less difficult for startups to raise outside of places like Cambridge or New York City, and Worcester is now very much in that game. If you got a varsity team, you can raise from anywhere, and there's a lot of varsity teams in the area now." Access to capital New Central Massachusetts business incorporations, which includes every- thing from tech startups to holding com- panies, were relatively flat in 2024 aer several years of growth, with 2,904 new businesses started in the region last year compared to 2,948 in 2023, a decrease of about 1.5%, according to a WBJ analysis of data from the Massachusetts Secretary of the Commonwealth. is decline was smaller than the statewide total, which fell from 15,200 to 14,880, a 2.11% reduction. While the level of new Central Mas- sachusetts corporations have flattened, startups in Worcester have had success- ful capital raises despite the lack of a Los Angeles or New York address; Leal erapeutics, a biotech company focus- ing on developing precision medicines for high-need nervous system disorders, has raised more than $84 million in ven- ture capital and other types of investor funding since being formed out of MBI in 2021. "When I first got here in 2015, folks said, 'You'd never raise venture capital money from Worcester,'" said Weaver. "Now we're seeing companies compet- ing for world-class capital dollars." In total, Worcester biopharma firms brought in $56 million in venture capital in 2024, according to the annual report from the Cambridge nonprofit MassBio. Outside the biotech space, Blustream, a Worcester-based tech firm looking to help companies stay connected with customers aer purchases, has raised $10 million in multiple raises since 2017, according to Crunchbase. Mining the local talent pool e region's startup ecosystem has grown since 2014. at year saw e Venture Forum, a nonprofit aiming to boost tech-based entrepreneurial activ- ity and economic development started Worcester's entrepreneurial ecosystem is now attracting more investors for startups Jon Weaver, president and CEO of Massachusetts Biomedical Initiatives After more than two decades in the startup space, Jay Cahill chose to launch his latest venture in Worcester, citing the region's talent pool and grow- ing entrepreneurial scene.

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