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Rarely, if ever, is success a result of one factor or person.

In football, contributions from positions like running backs directly influence a team's ability to win or lose, but they aren't solely responsible for the game's outcome.

Similarly, the success of startups or a startup community doesn't depend on venture capital funding alone. Like a running back's ability to push the ball forward and put points on the board, venture capitalists (VCs) and their investments can move entrepreneurs, their businesses and subsequently, their communities towards success. But alone, their actions don't equal a loss or win.

If the success of North Carolina's startup scene solely depended on the number of deals between venture capitalists and entrepreneurs and the total amount of money VCs invest in N.C. companies, North Carolina would be screwed. Any way you cut it, the most recent data released by the PricewaterhouseCoopers/National Venture Capital Association (NVCA) show North Carolina is trailing its peers (and some non-peer states) in both the number of deals between VCs and entrepreneurs and the total dollar amount VCs invested.

Is this the whole story? Jason Caplain of Bull City Venture Partners (BCVP) doesn't think so, and I'm inclined to agree with him. Along with Caplain's thoughts on the matter, we're highlighting five key stats from the data you should know to better understand how VC impacts N.C.'s startups and startup community.

Zero

* What it Represents: The number of quarters N.C. was one of the top 10 states (of all 50 states plus D.C.) for number of deals or VC investments since Q1 2012. N.C. did rank in the top 15 in deals in seven of the 10 quarters, but in total investments made by VCs to N.C. entrepreneurs, N.C. only ranked in the top 15 three times.

* Why it Matters: The states we compare ourselves to, including California, Massachusetts and New York, all consistently rank in the top three for both deals and total dollars invested. Other peers like Texas, Pennsylvania, Colorado, Illinois, Virginia, Ohio and even Minnesota also made several appearances in the top 10 for both measures.

* Insider Perspective: It's a good thing I don't consider myself a member of the media or a journalist, otherwise I might have been offended when Caplain said in so many words that while the media and journalists track and place a lot of importance on quarterly stats, he doesn't think they are that helpful in predicting the region's success. He evaluates the market and numbers with long-term, five- to 10-year increments in mind. He said - and I agree - that, "One quarter's numbers don't necessarily predict a trend."

Agreed, but the trend is for several quarters, correct? And a quick Google search reveals that North Carolina ranked eighth among states for venture capital dollars raised in 2010. So it's clear something is going on in recent years. But perhaps more context will be helpful.

$13 Billion

*  What it Represents: The total amount of money VCs invested in companies in Q2 2014. N.C. startups brought in almost $32 million while California earned its top spot with nearly $8 billion in investments.

* Why it Matters: At almost $13 billion in investments, Q2 2014's numbers are higher than any in recent quarters. They're nearly 25% higher than Q1 2014 numbers and over 50% more than Q1 2012 numbers. Not since the dotcom bubble of the late 90s-early 00s have we seen that significant of an increase in a two-year period.

* Insider Perspective: While N.C. hasn't seen as much of an increase in VC investments as the rest of the country, according to Caplain, the number of individual angel investors and angel groups in N.C., and subsequently their investments, have risen significantly the past few years. Proof of the rise in angel groups and angel investing comes in ExitEvent reports from March and May (after several angels came deal-hunting to the ExitEvent Social in Raleigh). And N.C. seems to be following a national trend. As seen in Figure 1, data from the Center for Venture Research at the University of New Hampshire show a steady increase of "active angel investors" and the number of high growth ventures they have funded.

1,114

* What it Represents: The total number of deals made in Q2 2014. N.C. companies made 10 deals in this quarter, while the top-ranked California closed a whopping 465 deals.

* Why it Matters: Deals are rising at less than half the rate of total money VCs invested. The number of deals isn't increasing at the same rate as total investments, which means more money is being invested per deal but the number of entrepreneurs receiving those deals is not rising at the same rate. So relatively speaking, while the number of deals has increased, the net number is at-best stagnant and possibly decreasing.

* Insider Perspective: "For whatever reason, not all deals are reported," says Caplain. PwC sends its survey to firms (like BCVP) and relies on them to report their investments. Caplain admits to sometimes not responding if the company isn't ready to announce funding news. And he'd be surprised if PwC is reaching individual angel investors with that survey. Thus, it's important when tracking the data to remember that some deals happening in N.C. might not show up in this data.

.04 Percent

* What it Represents: The average percent of N.C. entrepreneurs who made deals with VCs from Q1 2012-Q2 2014. By combining the Kauffman Foundation's Entrepreneurial Index values with the PwC data, we can see (roughly) how many entrepreneurs receive investment. In the past 10 quarters, the highest rate of N.C. entrepreneurs raising venture capital was in Q4 2013, when .06 percent or about 18 out of roughly 31,500 NC entrepreneurs raised money.

* Why it Matters: While not all N.C. entrepreneurs attempt to raise money each quarter, the number of N.C. entrepreneurs receiving funds is significantly lower than those in other states. In Q2 2014, Massachusetts entrepreneurs fared the best with .67 percent of entrepreneurs receiving venture capital. D.C. followed closely behind with .59 percent of entrepreneurs making deals. Perhaps the most disheartening takeaway from these stats is that both Massachusetts and DC have fewer (absolute and relative) entrepreneurs than N.C. but have consistently secured more deals than N.C. entrepreneurs.

* Insider Perspective: These numbers only look at VC data. Caplain again harped on the strong increase and presence of angel funders throughout NC. And just in case you think BCVP is resting on its laurels since raising its $26 million dollar fund, Caplain makes sure to point out that his hope for the fund is that it will help attract other VCs to N.C. (check out ExitEvent's coverage of the fund here). He says that VCs "always need friends."

78

* What it Represents: The number of funds U.S. VC firms raised $7.4 billion in new commitments from in Q2 2014. It's the highest number of funds reported since Q4 2007.

* Why it Matters: Because the increase indicates that more dollars are available to VCs and entrepreneurs than for years prior. It also could be evidence of the "changing structure of the VC industry" that both Mark Suster of Upfront Ventures and Scott Kupor of Andreessen Horowitz have talked and written about recently. The two California VCs note that there seems to be, "a rise of small funds and a concentration of capital among fewer, larger firms" among other changes, like a decline of high assets (think over $100 million) in VC firms. The rise in VC funds this quarter supports these theories, because while the number of funds rose, the total capital they raised was $2 million shy of last quarter's.

* Insider Perspective: Caplain agrees with Kupor and Suster's assessment of the current VC market, but notes the trends they observe are mostly happening in other markets and not necessarily in N.C. or the Southeast. He did mention that overall, he's noticed a rise in smaller funds like BCVP, but that "just because they're smaller today doesn't mean they'll stay smaller." Hopefully, they'll realize success and grow.

Game Over?

In terms of VC funding, N.C. is similar to our local NFL team, the Carolina Panthers. We are consistently "putting points on the board" each quarter and winning some games, but rarely making it to the playoffs or the Super Bowl. We play better than some notoriously poor performers like the Oakland Raiders (Mississippi would be its state equivalent) but we consistently and significantly rank behind our peers - the Pittsburgh Steelers (Pennsylvania) and the New England Patriots (Massachusetts) on the number VC deals and amount of investments.

Like Caplain says, what happens one quarter doesn't necessarily mean there's a trend, but N.C. VC deals and investments haven't been stellar for the past 10 quarters.

Perhaps it's time to start calling the low number of deals and investments a trend like WRAL TechWire's Editor Rick Smith noted a few weeks ago. But like a running back doesn't play alone, remembering that VC money isn't the only money flowing into N.C. startups is important. Nor is money the only indicator of success.

VCs don't operate in a vacuum, they respond to external pressures and changes, just as a running back would change course if he saw he might be tackled. Both Kupor and Suster note that another factor influencing VC numbers is that it's cheaper and somewhat easier to build tech companies today than ever before. In addition, most entrepreneurs aren't young millennials with no savings. They're middle-aged people with experience and possibly financial stability and savings to build their business from.

As the Kauffman Foundation reported in its latest Index, the only age group to increase its rate of entrepreneurship in 2013 was the 45-54 age group (Check out ExitEvent's article on the changing face of startups). With a good idea, some money saved up for initial costs, and a lot of drive, today's entrepreneur can bootstrap his or her way to success - or at least the beginning of it. As Kupor says so eloquently, "While it is in fact cheaper to get started and enter the market, it also requires more money for the breakout companies to win the market."

So the decline in VC funds in N.C. might have more to do with a lack of demand for VC funds than a lack of interest in N.C. companies or the supply of VC funding.

Looking at quarterly VC data can be enlightening and help us keep track of what's going on locally and nationally, but it isn't the sole measure of our startup community's success. A startup's win or loss depends just as much on the entrepreneur and the quality of the idea as the ability to obtain funding. We also need to think like Caplain, with a long-term perspective in mind. One game's outcome doesn't necessarily determine whether a team makes it to the Super Bowl. Indeed, with nine IPOs announced in 2013, many companies in our state seem to be investing in winning championships, not just games.

As Caplain notes, not only are angel investments growing, but more VCs are starting to "lift up their heads and look at what's happening here."

In N.C., our season isn't over, perhaps it's just beginning.