From Massachusetts Economic Development Guide 2023-24

Life Sciences Lead VC Wave in Boston

Venture Capital
Photo: Getty Images
by Mark Arend

enture capital investment declined in 2022 from the record-setting levels of 2021, especially in the third quarter last year, according to October 2022 analysis from Jeffrey Grabow, Ernst & Young’s (EY) U.S. Venture Capital leader. Yet the health and life sciences sector remained the largest recipient of U.S. venture capital investment, at $9.1 billion in the third quarter. That’s why Massachusetts enterprises hardly noticed the VC brakes being tapped.

Home to a thriving life sciences industry, the Bay State is a leader in attracting capital. EY ranked Greater Boston third in the U.S. in Q3 2022 for venture capital investment behind only San Francisco and New York. 

The Massachusetts Biotechnology Council (MassBio) also weighed in on the state’s venture capital activity in its 2022 Industry Snapshot analysis. From the executive summary: 

Venture capital (VC) funding of the biopharma industry remains strong in 2022 despite a downturn in biopharma stock valuations. 

• The first six months of 2022 had the 4th highest amount of venture capital investment in Massachusetts-headquartered biopharma companies of any full year.

• Companies located outside of Cambridge, in communities such as Waltham, Bedford, and Watertown, received 57% of these investments (up from 42% in 2021).

This strong VC funding along with additional expansion by established biopharma companies has driven a continued high demand for new life sciences lab and biomanufacturing space across the state. 

• Now totaling 55 million sq. ft., more than 15 million sq. ft. of life sciences–specific space came online in Massachusetts in 2021, a three-fold increase over the previous year’s growth.

• There are pipeline projections of between 26 million and 59 million sq. ft. of new lab and Good Manufacturing Practice (GMP) space by the end of 2025. 

• There are 1.7 million sq. ft. of GMP under construction across Massachusetts, almost exclusively outside Boston and Cambridge.


Massachusetts-based biopharma companies in the first half of 2022 saw VC investment of $5.1 billion. A total of 122 companies received 124 rounds of investment, the average of which was $41.1 million compared to the national average of $28.8 million.

Using July 2022 Pitchbook data, MassBio says the top five municipalities receiving VC in the first half of 2022 were Cambridge, Boston, Waltham, Watertown and Bedford.

Microelectronics Hub
Seeks Funding

Meanwhile, in February, the Center for Advanced Manufacturing at MassTech Collaborative (CAM) and more than 85 organizations from across the Northeast submitted a proposal to the federal government to create the Northeast Microelectronics Coalition. The Coalition would be “a regional hub that will advance the microelectronics needs of the U.S. Department of Defense (DoD) while spurring new jobs, workforce training opportunities, and investment in the region’s advanced manufacturing and technology sectors.” 

CAM is a division of the Massachusetts Technology Collaborative (MassTech), a public economic development agency tasked with supporting business formation and growth in the Commonwealth’s tech and innovation sectors.

“Massachusetts is a leader on innovation, technology, and advanced manufacturing, and we’re proud to continue that legacy by submitting this proposal,” said Governor Maura Healey in a statement. “This is a once-in-a-generation opportunity to invest in cutting-edge sectors that will be key to our country’s national security and ensure Massachusetts companies have the resources and workforce they need to succeed. We’re thrilled to put forth this competitive proposal to bolster the industries keeping Massachusetts at the forefront of innovation.” 

The Coalition submitted the proposal to the DoD’s Microelectronics Commons program, which is funded by the 2022 CHIPS and Science Act that aims to onshore the manufacturing of microelectronics and semiconductor technologies and support workforce training for these industries.  

Mark Arend
Editor Emmeritus of Site Selection magazine

Mark Arend

Mark Arend is editor emeritus of Site Selection, and previously served as editor in chief from 2001 to 2023. Prior to joining the editorial staff in 1997, he worked for 10 years in New York City at Wall Street Computer Review, ABA Banking Journal and Global Investment Technology. Mark graduated from the University of Hartford (Conn.) in 1985 and lives near Atlanta, Georgia.


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