Edison Partners returns fire at out-of-town critics at IMPACT '14, but tends to find most of its own deals elsewhere
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In a blog post entitled "Where's the Love for the City of Brotherly Love?", Edison Partners (Lawrenceville, NJ) General Partner Michael Kopelman wrote about how a panel of out-of-town VCs at 2014 IMPACT Capital Conference in Philadelphia late last month "dissed"(my words) the Philadelphia startup scene, paraphrasing their comments as saying "the Philadelphia region doesn’t have enough great companies, nor great entrepreneurs, to justify their 70-minute train ride or flight down from NYC or Boston."
The purpose of having an out-of-town panel(none of whom have closed a deal here) was to give Philly attendees an idea of how outside investors view the startup community here.
Kopelman then recites all the great companies Edison has helped build in Philadelphia over 30 years (true) that have been acquired, including Fiberlink (acquired by IBM), Verilogue (Publicis), Cadient (Cognizant), VirtualEdge (ADP), and Octagon (Accenture).
But Edison has not invested in a Philly metro-based company in quite some time. In fact, going through Edison's own funding announcements and CrunchBase I didn't find a single one going back to 2010, when there were follow-on rounds in some existing portfolio companies (including Health Market Science, which coincidentally announced today it was being acquired. Please let me know if I missed any.) There aren't too many Philly firms remaining in Edison's portfolio other than Neat Company, which I recently profiled. Also, there's Hamilton, NJ-based Billtrust, which took on Bain Capital Ventures as its lead investor two years ago, and Miria Systems of Media, PA. There were a couple of other small investments in central New Jersey.
When Edison raised its $249 million seventh fund in 2012, there were expectations it would deploy some of that capital in Philadelphia-area ventures. I'm not knocking Edison, which has an excellent track record (not believing in an overly provincial approach to VC investing), and I'm sure its people cover the region closely, but in fact most of Edison's recent investments have taken place in New York, Northern NJ, DC, with a few scattered in the midwest and south.