Access to Venture Capital
New Atlantic Ventures in Cambridge, MA
Rail service operated on the NEC connects new businesses throughout the Northeast to the capital investments they need to grow. Rail plays a particularly key role in facilitating access to capital in mid-sized cities throughout the corridor. Capital markets in the Northeast are highly concentrated in the Boston area and New York City, and jump-starting innovative companies in the technology, biotechnology, and service sectors outside of these large hubs can be a challenge.
New Atlantic Ventures is a Massachusetts-based venture capital firm. The company reports that it concentrates projects in NEC markets because it allows them to play a hands-on role in their investments. Eight of their last 28 deals were in New York City alone.
An attorney working with the venture capital and private equity markets underscored the role of location and access in decisions made by investors. Many venture capitalists limit their investments to particular regions for a variety of reasons, including ease of transportation access. This attorney describes location as a “very big deal” in emerging markets, with the trend in the venture industry to go so far as to incubate companies on-site so that the venture capitalists can have unlimited access to the start-up’s executives.
Both investors and recipients of venture capital report that the NEC facilitates the growth of their businesses. Making new business connections while riding the train is also commonplace, especially on Acela. Nearly all business leaders interviewed for this report emphasized that virtual communication does not replace the face-to-face interaction required in complex investment relationships.
Financial District, Boston, MA. Source: flickr user Roger Ward.
“The interconnectedness of the two cities is the most measurable aspect of the venture interplay. Boston venture capitalists invest heavily in the New York area, and vice versa.”
— Tim Rowe, Founder and CEO, Cambridge Innovation Center and Venture Partner, New Atlantic Ventures. Cambridge Innovation Center is co-working space focused on serving the needs of start-ups. New Atlantic Ventures is an early stage information technology venture capital firm.