Baltimore hits $90.9M in VC activity to start 2025
The Baltimore region began this year with a slow trickle of venture capital activity, in stark contrast to its spike at the end of last year.
This year's first quarter saw $90.9 million invested across 19 deals throughout the Baltimore metropolitan statistical area, according to PitchBook and the National Venture Capital Association's latest quarterly Venture Monitor report. That's about 50% lower than the last quarter, which saw $179.2 million across 15 deals — meaning check sizes are typically lower across more deals.
HarborLink, a late-stage telecommunications infrastructure company, nabbed approximately half of the total money in the region this quarter.
These statistics are not surprising to Jeff Cherry, the founder of the Baltimore-based accelerator Conscious Venture Lab. In addition to leading the program's parent organization, the Novella Center for Entrepreneurship, Cherry also serves as the CEO and managing general partner of the early-stage investment firm Conscious Venture Partners, which has funded several alums of the accelerator.
There's too much money 'on the sidelines,' he explained — in other words, there is wealth to be invested in companies, but limited partners aren't writing many checks to put money in funds.
Investing in venture capital is risky, Cherry acknowledged. Liquidity has been lacking over the last decade, with few exits or IPOs. But more deals need to get done, and those funds should also be from the Baltimore region.
'There's not enough money, local money, coming into venture as there should be,' Cherry told Technical.ly, 'in order to continue to catalyze the great things that are happening here.'
He's about to start raising money for Conscious Venture Partners' third fund, and is bracing for difficulty.
'We know it's going to be a challenge,' Cherry said. 'It's going to be an uphill battle.'
Baltimore's VC flow was also slow at the beginning of 2024. In that year's first quarter, the region's companies accrued $89.8 million across 20 deals — nearly identical figures to Q1 2025. 2023 and 2022 started with $78.3 million and $77.7 million, respectively.
This isn't unique to Baltimore, though: Cherry noted that deal flow is down in other parts of the Mid-Atlantic. Philadelphia saw a dip in activity, and DC's numbers were lower this quarter compared to the end of last year. Contrarily, Pittsburgh saw historical numbers, though 90% of the total funds went to two companies.
AI strength amid anti-DEI attacks
David Asbery, founder of the direct-to-consumer platform independent musician platform Pedestal, has been going after capital for about two years. This year, he received $25,000 from Maryland's venture arm TEDCO.
TEDCO initially rejected his funding appeal, but encouraged him to do a program through the organization to polish his pitch. He got to pitch for 10 minutes and got 10 minutes of feedback as well as connections to investors.
'Anytime I get rejected, and there's some type of, 'Hey, we didn't pick you for this, but click here and do this,'' Asbery told Technical.ly. 'I always click here and do whatever they say … because I look at it as following the stream.'
Now he's in talks with additional venture capitalists in Baltimore, but he's found that investors want to participate with fellow funders in a $1 million round — not necessarily write the checks for hundreds of thousands that he's seeking out. The process of finding additional investors is also time-consuming.
Asbery is not looking for a round of that caliber at the moment, but found these investor conversations helpful for making the connections he can leverage when he reaches that point.
That said, he's seen a stark difference in raising money for Pedestal versus Rush Roto, the AI photo editing platform developer he cofounded.
'Depending on the industry that your startup belongs to, that also is a big determining factor in the type of funding and attention you're going to get,' Asbery said.
Rush Roto has collected $500,000, including some funds from an initiative for Black founders backed by Amazon Web Services. He predicts that accelerators and programs for underrepresented founders will continue to dwindle under the Trump administration due to attacks on diversity, equity and inclusion programming. He speculated these attacks may explain why venture capital funding dropped this quarter.
'Now we're in a new environment where it's frowned upon,' he said.
Founders: It's time to be capital efficient
Cherry from Conscious Venture Partners believes it'll continue being difficult for startups to raise. He encourages founders to focus on profitability and becoming capital efficient. Those that follow this will grow slowly, but it'll work out in the long run, he said.
Pedestal's founder Asbery is following that rule: He still has money in the bank from the TEDCO investment.
Given the economic turmoil, startups will likely have to raise at lower valuations because of risk in the market, Cherry said. Tariffs will also negatively affect founders — some startups relying on products from abroad may fail, he said.
Despite these difficulties, Cherry wants venture capitalists to write checks. Investors need to double down on investing in innovation and early-stage businesses, because that's where the returns exist.
This quarter marks a downturn for Baltimore, but compared to when Cherry moved to the region in 2013, the ecosystem has grown exponentially.
'I think that we are getting much better as an ecosystem of being connected, but we're still not perfect,' Cherry said, adding: 'I still think that there's work to do in terms of turning this collection of assets we have into a stronger ecosystem. It is light years ahead of where it was.'
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