One of the interesting trends in the venture capital business around these parts over the past few months has been the number of deals being done by Seattle venture capital firms outside of the region. OVP, Madrona, Frazier and Voyager all have been spending time (and money) outside the region. And so is Ignition Partners, which today emerged as the backer of video encoding startup by the name of Zencoder. Interestingly, Zencoder is based in Minnesota, but the founders of the company plan to uproot themselves and move this summer to … San Francisco.

The company’s other backers are based in the Bay Area, including Andreessen-Horowitz, Lowercase Capital, SV Angel, 500 Startups and a number of prominent angels. Zencoder also is a graduate of the Y Combinator program, the high-tech incubator that’s made it a practice of spitting out high quality companies. Zencoder is the latest, having raised $2 million.

Once again, this migration of capital speaks to one of the challenges facing the Seattle tech community. Even when Seattle investors find good deals elsewhere, the region doesn’t quite have the gravitational pull of Silicon Valley. (I touched on this topic over the weekend too: “Seattle teens behind ‘The Grim Tweeper’ app dream of making it big … in Silicon Valley”).

It is worth noting that Ignition has assisted in bringing one of its San Fran portfolio companies to Seattle, helping Splunk establish a branch in the city’s South Lake Union neighborhood.

You can’t blame VCs for looking elsewhere for deals. Opportunity is opportunity, and especially in this climate venture capitalists are clamoring to get into the hottest startups.

Unfortunately, some of the best results for Seattle venture capital funds also have occurred outside the region in recent memory. For Ignition, that includes the sale of San Francisco portfolio company Heroku to Salesforce.com for $249 million. And the Bellevue firm’s first company to go public happened to be ChinaCache, based in Beijing.

Ignition still has plenty of companies in Seattle, and I am told there’s at least one other deal that’s about to get done. Most Seattle venture firms will tell you that they are committed to the region, and that’s true as long as there are “high-quality deals” to do here.

The problem with the venture capital mechanics these days is that venture capital firms are finding it necessary to pile into the most promising deals, no matter where they are located. And some of the smaller opportunities get pushed aside.

By my count, more than half of Ignition’s portfolio is made up of Seattle area companies. But some of the firm’s most recent investments — Hipmunk, Topsy and now  Zencoder aren’t located here.

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