Minnesota did more deals in Q2 than in any quarter last year.

Minnesota startups raised $90 million across 18 deals in the second quarter of 2026, according to our Q2 funding data. Those 18 deliver the state's highest deal count of any quarter since late 2024, meaning more Minnesota companies closed a round in Q2 than in any three-month stretch of the past 18 months. And yet the dollar figure went down.

The average Minnesota round in Q2 was $4.98 million. A year earlier, in Q2 2025, it was $13.84 million. The quarter immediately before, in Q1 2026, it was $10.68 million. More companies than last year have been raising money; yet each of them is raising less of it.

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Minnesota is so consistent in funding that it is difficult to know how much to read into this. The state closed 2025 with a $492.7 million fourth quarter, its strongest of the year and largest since 2022. With Q1 2026 bringing $181.55 million, halfway through this year businesses across the state have raised $271 million in  total — 25% of the way towards matching the $1.01 billion it posted across all of 2025.

Year over year, this quarter represents a 42 percent drop in funding value. It is worth saying that this is a regional condition this quarter, not specifically a Minnesota one. Every one of the six states we cover posted a year-over-year decline in Q2 and Minnesota's was the smallest fall of that six. Ohio fell 85 percent. Indiana fell 77 percent. Minnesota's 42 percent was, relatively speaking, the softest landing in the Midwest.

So is a 42 percent decline the good news? In a quarter like this one, more or less.

That’s because U.S. startup funding hit $155.67 billion in Q2, up 212 percent year over year, as capital continued to pile into a shrinking number of enormous late-stage rounds — most of it in California, which took nearly 79 percent of the national total by itself, while the average U.S. deal was $83 million. 

Minnesota meanwhile sat third among the six Midwest states by total value, behind Michigan's $764 million — a figure driven by outsized deal sizes rather than volume, on just 14 deals — and Illinois's $226 million was across 41 deals. Minnesota's $90 million puts it ahead of Wisconsin, Ohio, and Indiana, and its 18 deals are second only to Illinois. On a volume basis, therefore Minnesota continues to be one of the busier ecosystems in the region. 

What should a founder or an investor take from this? Deal count and dollar value measure two different things of course. An increasing deal count can indicate more impetus to get companies off the ground. Minnesota's Q2 is the same as most of the Midwest. The top of the funnel is working — early-stage activity is up, not down — but $50-million-and-up rounds that actually move a state's total, have gone quiet for two quarters running. 

A quarter where deal count climbs and the average check shrinks is not the same as a quarter where the ecosystem is contracting; instead it is one where the ecosystem is active but under-capitalized at the top end. Those are different problems and only time can indicate whether there is anything to be concerned about.

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