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Florida falls in venture ranking

Venture investing may be picking up some momentum nationally after a three-year slump but Florida has become a less attractive destination for those dollars.

Last year, investors put $229.9-million into startup companies in the state, according to PricewaterhouseCoopers/Venture Economics' MoneyTree report. That was just 1.3 percent of the total $18.2-billion invested nationwide.

Among states receiving venture capital, Florida fell to No. 15, down from ninth place at the height of the venture boom in 2000. California, which has been No. 1 for years, topped the list again in 2003 with $7.7-billion in venture investments.

Though the state's entrepreneurs generally fared poorly in attracting capital last year, there were three Florida companies that bucked the trend in a big way during the fourth quarter, when a total of $75-million was invested. It was the busiest quarter of the year.

PODS, the portable, on-site storage company in Clearwater, received $18-million in expansion capital from Hunt Private Equity Group of Dallas and others.

Recruitmax of Ponte Vedra Beach got $17.2-million from investors for its human resources software.

And Applied Genetic Technologies, a biotech in Alachua, received $15.2-million from four investment groups.

"Significant deals are attracting top-tier venture guys, but as a whole, things are still struggling," said Marty Donsky, marketing manager for PricewaterhouseCoopers.

"On the positive side, the biotech deal is significant. I've never seen anything like that before."

Donsky, who worked in PWC's Tampa office before relocating to Washington, D.C., last year, said Florida startups continue to be handicapped by a lack of early-stage funds, as well as their distance from traditional money centers like Boston and Menlo Park, Calif.

"It really strikes me that things are back to the way they were in 1995," Donsky said, referring to a year when venture investments in Florida were $242-million.

"The exceptional deal will get the attention and money. But overall flows will be relatively low."

Tom Wallace, chief executive of MarketSmart Technologies in Tampa and former head of Tampa Bay Technology Forum, said he thinks the picture will gradually improve for the state's entrepreneurs.

"Florida, along with other parts of the country, seems a little slower to recover from the tech downturn," he said.

"But things seem to be picking up. Money is looser, and companies seem to be having an easier time raising money now than six months or a year ago. Serious money is available looking for good opportunities."

_ Kris Hundley can be reached at hundleysptimes.com or (727) 892-2996.

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