San Francisco Startups Drew $61.2 Billion in Venture Funding in 2021, With a Clean-Energy Financier Leading the Biggest Rounds

San Francisco startups attracted $61.2 billion in venture capital in 2021, more than twice the amount raised in 2019 before the pandemic, according to data from Pitchbook. The total came even as Covid shutdowns kept many offices empty.

Large venture deals are being watched as an early signal of whether businesses big and small will recover in the Financial District, SoMa and surrounding neighborhoods. Commercial real estate firm JLL reported that venture-backed companies made up 52% of the city's leases above 50,000 square feet in the fourth quarter of 2021.

Pitchbook's analysis found that the largest single funding round for a San Francisco startup last year went to a company outside the traditional tech label. Generate Capital raised $2 billion to finance sustainable energy infrastructure. Based near the Embarcadero, the company finances, builds, owns and operates clean energy and sustainable infrastructure projects. That round followed a $1 billion raise in 2020, and its total funding stands at $10 billion, supporting more than 2,000 assets in its portfolio.

Technology would claim the top spot if the two rounds raised by Databricks were added together. The East Cut company sells what it calls a "data lakehouse," a storage and artificial intelligence architecture meant to make data warehouses obsolete. In December it launched Databricks Ventures, a fund that will invest in startups to expand its ecosystem.

Other companies in the top 10 included Chime, an online bank on Maiden Lane that does not charge overdraft, monthly or miscellaneous service fees. Its latest round is intended to position it for an IPO in 2022. Airtable, a Mid-Market maker of cloud-based collaboration software for knowledge workers, raised $735 million, lifting its valuation above $11 billion. Another San Francisco firm is building a blockchain platform that aims to reshape the economics of video games, letting players pay for, own and trade assets while offering developers improved payments, security and tax systems.

Hinge Health, a Financial District digital clinic that treats chronic back and joint pain and other musculoskeletal conditions, raised $600 million in October, making it a major presence in online health. Uber Freight, a subsidiary of the Mid-Market ride-hailing company, matches shippers with carriers for cargo deliveries worldwide. In November it paid $2.25 billion in cash for Transplace to strengthen the shipping technology on its logistics platform.

Lime, based in SoMa, rents electric mopeds, scooters and bikes through a mobile app. Two years of Covid reduced its ridership, but the company hopes a post-pandemic reopening and its new financing will lift usage and prepare it for an IPO this year.

Stripe also figured among the year's top fundraisers. When the payments processor closed a $600 million round last March, it was valued at $95 billion, making it the most valuable venture-backed company ever. The company has since moved its headquarters to South San Francisco, just south of the city limits.

Whether the money keeps flowing in 2022 is uncertain. City Hall is counting on continued investment, but because tech workers move easily between locations, there is no guarantee they will return to San Francisco offices.