New Jersey officials say the state attracted $5.5 billion of venture capital in 2021 to support a “flurry of activity” in different startups.

The funds were spread across 219 separate deals last year, according to a March 4 release from Gov. Phil Murphy’s office, and mark a nearly 224% increase from the $1.7 billion of venture capital dispersed across 154 deals in 2020.

Startup companies typically rely on venture capital in order to finance research and development for very early-stage products when the organizations lack revenue sources to pay for their operations.

A series of state subsidy programs have been in place for years to steer state funds directly to those startups, or to take some of the financial pressure away from their monetary backers. They’re part of a state effort to attract industries such as manufacturing; transportation and logistics; film and digital media; life sciences such as drug development, diagnostics and medical devices; financial technology; and clean energy.

“We’re very encouraged to see the VC community invest in New Jersey startups on a scale we haven’t seen in decades,” Murphy said in a prepared Friday statement. “It’s well known that New Jersey is the birthplace of innovation, but investors are clearly showing that our state is the future of innovation as well.”

One of the most notable venture capital firms to set its sights on a New Jersey expansion was the Princeton-based SOSV, which will bring a HAX hard tech startup accelerator headquarters to Newark. The 60,000-square-foot space will open next year to attract 100 startups, which each have to create 2,500 jobs over the next five years. Half of the costs of the office space will be footed by the state, and HAX says it will offer up to $50 million in support to certain participating companies.

The 2021 figures were compiled by the publication Pitchbook, which for years has ranked different states on how much they can lure in venture capital dollars.

New Jersey ranked ninth in the nation for VC dollars invested per state, officials said.

Friday’s numbers come at the heels of a number of state incentive programs signed into law over the past year, which Murphy, his administration and top lawmakers say will help chart the state’s pandemic economic recovery.

A start-run startup assistance program called the Angel Investor Tax Credit sets aside $35 million a year, where investors can receive a 20% guaranteed return on their investment with an added 5% for investing in startups in low-income communities, or those that are minority- or women-owned. To qualify, the company that received the investment must employ a maximum of 225 employees, of which at least 75% need to be working in New Jersey.

State officials estimate that they received 559 separate applications last year, approving state support for $100 million of investments into 39 startups, according to the Friday release.

Another program, the Technology Business Tax Certificate Transfer Program, or Net Operating Loss Program, which according to state officials has provided $1 billion of funding since its inception 20 years ago, is meant to help companies offset the financial losses that come with research and development.

Under the NOL program, technology and life sciences businesses, which by design rarely see a profit during the years spent developing their product, can acquire tax breaks for research and development that can be sold for at least 80% of their value, capped at $15 million per business.

Another program in the midst of the rulemaking period, with an expected launch-date later this year, is the New Jersey Evergreen Fund. Under it, both the state and private venture capital firms jointly invest in certain startups, with the goal of those companies growing in New Jersey and any returns of investment making their way back into the fund for future such investments in startups.

Tim Sullivan, CEO of the New Jersey Economic Development Authority, which runs the programs, said Friday that such programs will “bolster New Jersey’s innovation economy.”

“The investment community is taking notice,” he continued. “We are also seeing companies of all size choosing to benefit from all that New Jersey has to offer.”

Editor’s note: The story was updated to include New Jersey ranked ninth in the nation for VC dollars invested per state.