Exploring city and regional hedge fund activity through US VC investments

The fact that hedge fund performance has improved in recent decades would be an understatement. Hedge funds are participating in investments into startup companies, which is challenging VCs’ long-standing position on the market. PitchBook’s news team reported, in 2021, that traditional venture funding firms have been significantly outbidding by hedge funds. Sometimes by as much 50-100%.

We wanted to explore the most successful hedge funds across the US in light of their increasing presence in the private markets.

What are hedge-funds?

Alternative investment funds are hedge funds. They pool money with professional investors and then invest that capital with the goal of making a profitable investment, or returning their investment (ROI). Institutional investors may manage hedge funds. They use a variety risk-management strategies to reduce the risk. We have a blog post that explains everything about hedge fund. It includes information on why they are called hedge funds and how they function. Want to find out how to assess Hedge Fund Opportunities for your firm? We can help you there, too.

Notable VC investments and hedge fund participation in America by region

This list contains top VC deals involving hedge fund participation. We selected a handful of top cities based their geographic regions according to the US Census.

The Northeast

New York City was included as part of our research on hedge funds in northern US. We rounded out this section of the list with three other top demographic areas from the region–Philadelphia, Boston and Pittsburgh. These two cities combine for more than 30,000,000 residents. They are home to a wide range of vibrant, economy-driving industry, from New York City’s financial sector to Boston’s thriving health care space.


Venture Capital investments made in New York by hedge funds

DMA rank: 1

Total number VC investment with participation from hedge funds over the last 5 year: 198

In the last five years, largest VC deal involving hedge fund participation:

  • Company: Exos
  • The deal amount is $750 million
  • Date: September 28, 2018.
  • 1 Participation by New York City’s hedge funds


Investments in VC by hedge funds based in Philadelphia

DMA rank of 4

Total number VC investments in which hedge funds participated over the last 5 year: 14

Largest VC transaction with hedge fund participation in 5 years

  • Company: GoPuff
  • Amount of the Deal: $1.15 Billon
  • Date: March 23, 2021
  • 1 number of hedge funds in Philadelphia that participated


Investments in VC by Boston hedge funds

DMA rank number 9

Total number VC investment with hedge fund participation over the last 5 years: 111

Largest VC transaction with hedge fund participation in 5 years

  • Company: Intarcia
  • Deal amount $615million
  • Date: 3 August 2017
  • Number of Boston-based hedge funds that participated in the event: 2


VC Investments by Hedge Funds in Pittsburg

DMA rank number 23

Total number VC investments in which hedge funds participated over the past five years: 3

The largest VC transaction with hedge fund participation in 5 years.

  • Company: Gecko Robotics
  • Total deal amount: $73,000,000
  • Date: March 3,2022
  • Number of Pittsburgh-based hedge funds participating: 1

The Midwest

The US Midwest’s investment activity has increased over the last five-years after a mostly stable period during most of 2010s and the aughts. Chicago is one of three top US DMAs. The city has a growing number of tech startups. We’ve also paired it off with some of the major metropolitan areas in the region.


Hedge funds in Chicago make VC investments

DMA rank of 3

Total number of VC investment with participation by hedge funds over the last 5 year: 31

In the last 5 Years, largest VC deal involving participation from hedge funds:

  • Company: Uber Freight
  • Purchase amount: $550,000,000
  • Date: November 15, 2021
  • 1 Chicago hedge fund participated


Investments in VC by Minneapolis hedge funds

DMA rank: 15

Total number of VC Investments with Hedge Fund Participation in the Last 5 Years: 1

Largest VC transaction with hedge fund participation in 5 years

  • Company: GeneMatters
  • Amount of the deal: $10.2,000,000
  • Date: February 26, 2021
  • 1 Participation in Minneapolis Hedge Funds


Hedge funds invest in VC in Indianapolis

DMA rank – 27

Total number of VC investment with hedge fund participation over the last 5 year: 4

Largest VC transaction with hedge fund participation over the last 5 Years:

  • Company: Sexton Biotechnologies
  • Maximum deal amount: $5 Million
  • Date: September 24, 2019,
  • Number of Indianapolis hedge fund participants: 1

The South

Although there are many cities in the south that seem very different from each other, the one thing they have is their high ranking among DMAs. All four of our choices fall within the top ten. These cities not only rank high, but they are also very near one another, suggesting more regional similarities than one might initially believe.


Hedge funds in Dallas make VC investments

DMA rank: 5.

Total number VC investments in which hedge funds participated over the past 5 year: 8

Largest VC transaction with hedge fund participation over 5 years

  • Company: Instil Bio
  • Amount of the deal: $170.2million
  • Date: Wednesday, August 3, 2020
  • 1 Dallas hedge funds participated


Investments in VC by hedge funds DC

DMA rank: 7.

In the last 5 years, 12 VC investments have had hedge fund participation.

The largest VC transaction with hedge fund participation in 5 years.

  • Company: Cava
  • Deal value: $230 millions
  • Date: April 27, 20,21
  • 1 Hedge funds from Washington, DC participated


Hedge funds Houston invest inVC

DMA rank number 8

Total number VC investments in which hedge funds participated over the last 5 year: 10

Largest VC transaction with hedge funds participation in the last five years

  • Company: HighRadius
  • The deal amount is $300 million
  • Date: March 30, 2021
  • Houston: 1 Participating hedge funds


Hedge funds in Atlanta have made investment in VC.

DMA rank – 10

Number of VC investments in which hedge funds participated over the last 5 years: 6.

Largest VC transaction with hedge fund participation in 5 years

  • Company: Antios Therapeutics
  • Deal amount $96 million
  • Date: April 9, 2019, 2021
  • There were 3 Atlanta hedge funds participating in the event.

The West

The west coast is home of a very active startup culture. This is true both in Silicon Valley and anywhere else. We have selected the top two urban areas in California and all of America for this region. Two other cities are home to significant market activity.


Investments in VC by hedge funds Los Angeles

DMA rank: 2

Total number VC investments with participation by hedge funds over the last five years: 34

Largest VC transaction with hedge fund participation in 5 years

  • Company: VideoAmp
  • Deal amount $275 million
  • Date: October 21, 2121
  • Los Angeles had 2 hedge funds participating in the event.


Investments in VC by hedge funds San Francisco

DMA rank 6

Total number VC investment with hedge fund participation during the last 5 year: 136

Largest VC transaction with hedge fund participation in 5 years

  • Company: Generate
  • Deal amount is $2 billion
  • Date: July 19, 2019, 2021
  • Number of San Francisco hedge-funds that participated: 1


Investments by hedge funds to make in Seattle

DMA rank: 14

45 Total number of VC investment with participation in hedge funds over the last 5 year:

Largest VC transaction with hedge fund participation in 5 years

  • Company: Connect
  • Total deal amount: $400 million
  • Date: November 13, 2019,
  • 1 hedge fund from Seattle participated


Hedge funds in Denver make VC investments

DMA rank – 17

Total number of VC Investments with Hedge Fund Participation in the Last 5 Years: 9

Largest VC transaction with hedge fund participation in five years

  • Company: Guild
  • Purchase amount: $150 Million
  • Date: June 2, 2021
  • 1 hedge fund participated in Denver

A note on methodology

The map depicts the top-level metrics used by hedge funds in a glance. The map allows for informal comparisons among the four US regions. This post outlines the methodology we used to calculate the totals. We added up the city-specific numbers and then selected the best designated market areas (DMA) for our city choices. This list does not cover all of the cities in each region. We aim to give readers a sense about hedge fund activity in the US but not paint an entire picture.

Please note that all the data in this article was taken from PitchBook Platform on March 29, 20,22. Data is subject change frequently.

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