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Funding for New Jersey start-ups dropping

One of the biggest hurdles for budding entrepreneurs to clear is securing venture capital. However, a recent report indicates that New Jersey businesses are having increasing difficulty getting over that barrier. It states that funding for New Jersey start-ups dropped 78 percent in the first quarter of this year, continuing a downward slide that began in 2013.

According to the PricewaterhouseCoopers and the National Venture Capital Association report, just $19.6 million trickled into five start-ups in the state during the period. Contrast that with $80.2 million poured into eight New Jersey firms in the first quarter of last year.

A senior manager at PricewaterhouseCoopers Emerging Companies Services stated that this year’s quarterly figure is the lowest the firm has ever recorded in its report, but expressed hope that the upswing in venture capital nationally will soon be reflected here.

The first quarter of this year sank below even the third quarter of last year, when approximately $20 million went to new companies, the lowest total for New Jersey in 15 years.

A Pricewaterhouse managing partner said the slide in funding could be due to increased desire by some firms to be in New York City rather than outlying areas. His company's report shows that the New York metro area received $960.6 million in venture capital in the first quarter, up sharply from $565.5 million last year.

Securing venture capital is one crucial part of starting a business; choosing a business form (LLC, partnerships, limited partnerships, corporations, C-corporations, S-corporations and sole proprietorships) is another. A conversation with an experienced business law attorney can help an entrepreneur choose the entity best suited to their needs.

Source:, "New Jersey start-up funding continues to drop," Andrew Wyrich, April 19, 2014

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