Portland Area Sees Venture Activity Rise

Why did the hippies move to Oregon? Because there were no jobs.

That was an old joke a friend told me before moving to Portland. He thought it was funny until the sixth or so month of fruitless job-hunting in a state that currently boasts a 10.5% unemployment rate – almost a point higher than the national average. It’s a downside for a state that otherwise tends to score well on quality-of-life surveys for its natural scenery and contained urban sprawl.

But if recent funding news is any indication, Portland’s startup scene looks to be heating up, with several companies in expansion mode. Fifteen companies in the state raised $106 million in the first half of the year – already surpassing the $100 million raised in all of 2009. Three more Oregon companies announced funding rounds totaling $25 million this month.

Then another big round that sort of counts is the $30 million one announced today for Jive Software. The developer of social networking software moved its headquarters to Palo Alto last spring, but still has most of its employees in Portland, where its founders live, according to news site Oregon Live.

The region is also seeing attention from Silicon Valley VCs. For instance, Jive backer Kleiner Perkins Caufield & Byers announced an investment in another area company this week: Puppet Labs, a Portland-based developer of a platform for data center automation and configuration management. The company raised $5 million from Kleiner, Radar Partners and True Ventures.

Also this month, Advanced Inquiry Systems, a Hillsboro, Or.-based developer of testing tools for semiconductor manufacturers, raised $10 million from backers including Intel Capital, Applied Ventures, OVP Venture Partners, TL Ventures and KT Venture Group, according to Thomson Financial. And Providien, a Portland-based medical device startup, raised $10.5 million from Endeavor Capital.