Houston sees underwhelming venture capital funds in Q3 2019, following larger Texas trend

funding fumble

Texas venture capital deals had a slow quarter, according to Crunchbase data. Getty Images

The entire state of Texas saw an unimpressive third quarter of venture deals — especially compared to the second quarter's reports — and Houston was not immune.

The state reported $372.4 million fundraised by tech startups in Q3 of 2019, according to Crunchbase data, which is less than half of what was reported in Q3 of 2018 ($776.8 million) and what the state raked in the second quarter of this year ($830.6 million).

Houston brought in a measly $38.4 million last quarter, per Crunchbase, and compared to the $251 million raised by Houston companies in Q2, that drop stings. It's the lowest quarterly venture amount Houston's seen in over a year, and lower than Houston's $44.7 million reported for Q1. Zooming out a little, the city's venture reports remain a rollercoaster of sorts with strong quarters bookended by lousy ones.

Chart via InnovationMap using Crunchbase data.

Austin maintained its top spot on the Texas venture leader board with $236.4 million of Texas' total $372.4 million raised in Q3 2019, according to Crunchbase, but that's about $200 million less than the city raised in Q2. Meanwhile, Dallas — a city Houston usually competes with for the No. 2 spot — raised $70.3 million compared to its $126.7 million raised in Q2. The only region up in raises is categorized as "other Texas metros," which went from $7.3 million to $27.4 million between Q2 and Q3.

According to Crunchbase, the city's $38.4 million was raised in six deals between June and September 2019. The top deal of those six companies was raised by Axiom Space, which closed a $16 million in a seed round.

Crunchbase's Texas reporter, Mary Ann Azevedo, reminds readers that their proprietary data is subject to reporting delays.

"Actual deal counts and dollar volume totals are higher than what Crunchbase currently has on record, and the numbers we're reporting today are likely to change as more data gets added to Crunchbase over time," she writes.

Just like Crunchbase, InnovationMap doesn't get to report on every single venture deal. However, here are some of the raises we covered in the third quarter of this year.

  • Spruce, a service provider for apartment residents, raised a $3 million round in July. The company moved its headquarters to Austin around the same time. Read more.
  • Grab, a mobile software company that's designed an airport mobile ordering app, closed a multimillion-dollar series A this summer. Read more.
  • Fannin Partners LLC, an early-stage life science commercialization company, closed a $5.25 million round this summer. Read more.
  • Voyager, a bulk shipping software company, raised $1.5 million in seed funding in August. Read more.
  • Cemvita Factory, which created a way to mimic photosynthesis, raised an undisclosed amount from corporate partners in August and September. Read more.
  • Galen Data, which uses its cloud-based software to connect medical devices, closed a $1 million seed round in September. Read more.
  • Syzygy Plasmonics, a hydrogen fuel cell creator, closed a $5.8 million Series A round in September. Read more.
  • sEATz, an app that allows in-seat ordering, closed a $1.3 million seed round in September. Read more.
  • Sourcewater Inc., which specializes in oilfield water intelligence, closed its series A round at $7.2 million in September. Read more.
  • Topl, a blockchain developer, raised over $700,000 in its seed round in September. Read more.
Ad Placement 300x100
Ad Placement 300x600

CultureMap Emails are Awesome

Property Showcase

Houston researcher examines how AI helps and hurts creativity

eye on ai

As artificial intelligence continues to grow and seeps into spaces like art, design and writing, a Houston researcher is examining its effects on creativity.

University of Houston’s Bauer College Assistant Professor Jinghui Hou, in collaboration with scholars around the world, recently published the paper "The Double-Edged Roles of Generative AI in the Creative Process" in the journal Information Systems Research.

Through the research, the team identified two stages of creativity that AI can influence: ideation and implementation.

In one study, Hou and her team developed a lab experiment to examine the impact of a cutting-edge generative AI tool during the brainstorming or ideation phase on a group of designers with varying levels of expertise.

The study showed that nearly all designers who used generative AI during this stage improved in the creativity of their graphic design work, and that the improvements were substantial and consistent across the board.

“In the first stage, we find that for anyone, including ordinary people and expert designers, AI is very helpful because of its computational power,” Hou said in a news release. “It can go beyond the imagination that humans have. For example, if I wanted to imagine a tiger with wings, it would be hard to see that in my head, but AI can do it easily.”

However, a second study examining the implementation stage found that AI affects professionals differently than novice designers.

The study showed that novice designers continued to improve in all aspects of their work when using AI. But more expert designers did not see significant improvements in the implementation stage. Rather, expert designers who used AI spent 57 percent more time completing their work compared with their peers who did not use AI.

“In the implementation stage, we find that AI is still very helpful for those ordinary people, but it creates more work for expert designers,” Hou said in the release. “This is because the designer has years of training to materialize a piece of artwork. We find that AI uses different techniques to produce creative work. For designers, it can become burdensome to revise what AI made.”

Hou’s paper suggests that AI is most helpful in the brainstorming stage, but hopes to see generative AI developers program tailor the technology for expert-level, professional needs.

“It could give users more freedom to fit the technology to their usage pattern and workflow,” Hou added. “In a sense, it's not about people catering to the AI, but the AI technology catering to people."

World Cup's 14-mile Green Corridor to leave lasting impact on Houston

Big Win

The FIFA World Cup 2026 Houston Host Committee has announced new details about its massive Green Corridor project, including the many improvements that will outlast the iconic sporting event taking place in Houston this summer.

The Green Corridor will be a 14-mile long verdant artery connecting multiple major landmarks in Houston through safe, walkable paths that include shade trees and other improvements. First conceived in 2024 by the Sustainability Subcommittee led by Elizabeth Carlson, it will unite East Downtown, Downtown, Midtown, the Museum District, and Third Ward through a hike and bike trail as well as METRO Rail stops. Though the Green Corridor is beginning its life as a showcase for the city to visitors attending the FIFA World Cup June 14 -July 4, it will remain a permanent installation for Houstonians to travel the city without cars.

Management of the project is being handled by Impact Houston 26, a portion of the Host Committee empowered by the Harris County-Houston Sports Authority’s Sports Authority Foundation to promote long-term benefits to the city after the World Cup. Funding partners include private corporations as well as civic organizations such as the City of Sugar Land and Rice University.

“The Green Corridor reflects what Impact Houston 26 is all about, using the FIFA World Cup as a catalyst to deliver lasting environmental benefits for our city,” Carlson said in a statement. “Through Impact Houston’s pillar on sustainability, we’re able to collaborate with local stakeholders to create not just demonstrations of resilience and innovation but education and engagement in the community, a meaningful legacy long after 2026.”

The corridor will provide access to both Houston Stadium (also known as NRG Stadium) and the FIFA Fan Festival, as well as improve existing paths like the Columbia Tap Trail in Third Ward. These improvements include the installation of shade structures, native plantings, expanding the tree canopy, air quality monitoring devices, and water and bike repair stations.

Impact Houston 26 is also working with local institutions like the Houston Zoo, Greentown Labs, and Discovery Green to install various educational materials along the Green Corridor.

The Green Corridor initiative.Courtesy rendering

Below is a breakdown of other improvements planned or completed as part of the Green Corridor.

  • Downtown Houston Main Street Promenade: Four permanent shade structures, native plants, and expanding the tree canopy by 154% to be implemented by May 2026. Further shade structures and plantings planned for Texas Avenue.
  • East Downtown Management District: Native tree plantings and landscaping in and around the FIFA Fan Festival site to improve first/last mile connectivity around the Green Corridor.
  • Columbia Tap Trail: Installation of 325 solar lights.
  • Stadium Park/Astrodome and TMC/Dryden plus Fannin South Transit Center: Various landscaping and safety enhancements.
  • Midtown Houston: $1.5 million in landscaping and beautification along the Red Line, including over 80 trees, native plantings, water stations, waste receptacles, crosswalk improvements, and public art installations.

The Green Corridor is only one of the World Cup Host Committee's sustainability initiatives. In January, it announced the "New Year, New Hou" program that provides hospitality businesses such as restaurants and hotels with one of three certifications.

---

This article originally appeared on CultureMap.com.

Houston humanoid robotics startup Persona AI hires new strategy leader

new hire

Houston-based Persona AI, a two-year-old startup that develops robots for heavy industry, has hired an automation and robotics professional as its head of commercial strategy.

In his new position, Michael Perry will focus on building Persona AI’s business development operations, coordinating with strategic partners and helping early adopters of the company’s humanoids. Target customers include offshore platforms, shipyards, steel mills and construction sites.

Perry previously served as vice president of business development at Boston Dynamics, where he led market identification for robotics, and as an executive at DJI. He holds a bachelor’s degree in Chinese and government studies from the University of Texas at Austin.

“Now is the perfect time to join Persona AI as we rapidly close the gap between what’s possible in the lab versus what’s driving real commercial value,” Perry says. “Building industry-hardened humanoid hardware and production-deployable AI is only one piece of the puzzle.”

“Getting humanoids into operations for heavy industry will require the systematic commercial and operational work that makes enterprises humanoid-ready and defining the business case, solving the integration challenges, and building the playbook for safe, scalable adoption,” he adds. “That’s what I’m here to build.”

View All Listings