Hawai‘i Venture Capital Report (2010-2018)
By: Startup Capital Ventures and Purple Mai‘a
In 2018, Donovan Kealoha of Startup Capital Ventures and Alec Wagner of Purple Mai‘a released a report outlining four key trends in Hawaii's venture capital market, signaling growth and opportunities for VCs and startups:
Deal Flow Growth: The number of deals by Hawai‘i-based startups is increasing.
HI Growth Initiative Impact: The HI Growth Initiative stimulated activity in the Information Technology sector, with 48% of deals from 2012 to 2016 related to software. Early-stage software startups, particularly, are expected to drive later-stage deal demand as they grow.
VC Investment Stability: Despite spikes in 2012 and 2016, VC deployment remains stable, averaging around $20.88M per year.
High-Impact Externalities: Advances in technology startup initiation, coupled with efforts from public institutions and entrepreneurship entities, have contributed to a healthy early-stage innovation ecosystem.
The report suggests promising opportunities for VCs and entrepreneurs in Hawai‘i's startup ecosystem. It emphasizes the need for continued government initiatives, such as the HI Growth Initiative, and policies to incentivize companies to stay in Hawai‘i. Long-term investment in accelerators, incubators, and entrepreneurial education is crucial. While startups currently seek VC funding outside the state, increased VC availability and local company participation will enhance Hawai‘i's startup ecosystem over time.
