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Posts Tagged ‘CB Insights’

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Boo: The increasingly crowded unicorn club in one infographic
In honor of Halloween, here is our scariest infographic ever. We visualize the rise of unicorn companies since 2011. So much for unicorns being mythological.

https://www.cbinsights.com/blog/increasingly-crowded-unicorn-club/?utm_source=CB+Insights+Newsletter&utm_campaign=dd8c09211b-Top_Research_Briefs_10_31_2015&utm_medium=email&utm_term=0_9dc0513989-dd8c09211b-86855673

 

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Global Venture Capital Report – Q3 2015 KPMG and CB Insights: VC-backed Companies Haul in US$37.6 Billion Globally in Q3 2015 Due to Mega-Rounds and Continued Crossover Investor Activity- from CB Insights

An in-depth analysis into the financing trends including unicorn growth, mega-rounds, country breakdowns, the most active investors, and more.

https://www.cbinsights.com/research-q3-2015-venture-capital-report?goal=0_9dc0513989-5882a30484-86855673

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The Non-Dotcom Bubble: The World’s Most Popular Startup Domains Other Than .Com

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.com is still the king of suffixes. But startups are also flocking to other domains, including .io.

Download the Q2 2015 Global Venture Capital Report

In a recent essay, Paul Graham recommended that startups should own their .com domain name or risk being considered marginal or weak. However, .com domains can be very expensive, especially for younger startups. We used the CB Insights database to analyze the trends in startup domain suffixes over time, such as the rise of the .io suffix.

Traditional .com domains still dominate amongst the more than 25,000 tech companies funded since 2010, with 20,000+ companies choosing a .com domain for a 81% share of all suffixes.

But other domain suffixes are also popular. These include .net and .co domains, which proved to be the most popular, followed by .io which saw nearly 350 funded tech companies choosing that domain. After the top 3, the list is populated mostly by more geography-specific domains such as .de (Germany), .cn (China), and .jp (Japan). Also, .tv has been used by more than 100 companies, including well-known services Twitch.tv, blip.tv, and acfun.tv. The .ly domain, often considered  a go-to suffix for Silicon Valley startups, isn’t really all that popular.

Most Popular Suffixes

With a flurry of new domains having been made available by ICANN recently starting in 2014, startups will increasingly seize the opportunity and flock to alternative domain suffixes. But many of the newest suffixes like .global are not showing up on the radar just yet.

Top non-dotcom suffixes

Among the top URLs, some have seen more growth than others in recent years.

  • The .co domain saw the largest spike, with a 93% jump in the number of new companies being funded with that domain suffix between 2013 and 2014.
  • Both .io and .in have seen steady growth, and have already reached all time highs in 2015 in terms of registrations for funded companies.
  • .net domains, while having the most funded tech companies in total since 2010 (after .com), has slowed significantly in growth, with only 61 companies being funded with that domain name through mid-August 2015.

URL popularity by year

Unique suffixes per year

The number of unique domain suffixes attached to startups in a given year saw a significant jump between 2011 and 2012. There were 116 separate domain suffixes used by startups this year through mid-August 2015, almost double the amount in full-year 2010.

Unique URLs by Year

New suffixes

It’s not uncommon to see new domain suffixes pop up when looking at startups receiving funding (i.e., suffixes that have never been attached to a tech startup before). Below are select new domain suffixes that have been funded recently as well as the companies attached to them. In 2015, we saw new startups with .soy and .world suffixes. Some are country-level geographic suffixes, e.g. .dj is Djibouti.

Select Newly Funded Domain Suffixes
Year Suffix Select Companies
2012 .global, .om, .gg, .pro bluedot.globalpinion.ggbad.gycpac.pro
2013 .dj, .ae, .bi, .sr plug.dj, propertyfinder.ae, bbs.bi, hairdres.sr
2014 .limo, .life, .works, .today loup.limo, league.life, weave.works, celuv.today
2015 YTD .ventures, .world, .soy, .pictures entangled.ventures, myeye.world, bevisible.soy, folio.pictures

 

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We’ll make it up in volume
Hi there,

Ever wonder which VCs are the best at spotting unicorn companies earliest? Wonder no more. See who the unicorn whisperers are below.

e-Commerce’s big three
When it comes to eCommerce investment, it’s China, India, the US and then everyone else. The 3 markets account for 62% of global deal activity and 71% of total funding.

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Speaking of e-Commerce – this will be interesting

Jet.com, the startup founded by Diapers.com alumni Marc Lore, launched today and although it projects big losses and competition from Amazon, it is also rumored to be in talks to raise financing at a valuation of 3 unicorns.

So we wanted to anonymously ask you and 88,000 of our closest friends what you think of Jet’s prospects. Simply click below and we’ll report the results in the next newsletter.
Will Jet.com live upto the hype and become a credible competitor to Amazon?

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Google Ventures is slowing down

For our corporate VC benchmarking webinar next week, we’ve been digging into the performance of several notable corporate VCs. Today, we refreshed our Google Ventures teardown and see the CVC arm of Google is slowing down their investment pace while exits have ticked up as the company’s portfolio matures. More graphs and charts about their industry and geographic strategy than you’ll know what to do with.

 

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Quotable & Notable

We’re the most trusted source for VC and startup data by the media (seriously).

And it’s always good to see how our data intersects with larger stories our media friends are working on. Here are a couple that recently caught our eye.

Connie Loizos of TechCrunch highlights how startup employees are wising up.

“This week, a Bay Area founder was taken aback when an engineer being recruited by his startup asked for both its cap table and information regarding the liquidation preferences of its venture backers.”

Bloomberg’s Adam Satariano & Jing Cao discuss how fear is trumping greed for Valley VCs.

“While Silicon Valley heatedly debates whether technology valuations have risen to excessive levels, the investors who helped fuel the boom aren’t waiting for an answer. Venture capital firms are starting to take steps to protect themselves in the event of a downturn.”

Paul Mozur of The New York Times digs into Asia’s startup boom.

“Across Asia, investments in technology start-ups have escalated at the same swift pace and to the same heights as in the United States.”

Sarah Lacy of Pando says we need to stop talking about the sharing economy.

“Without Uber, the sharing economy would be an economy like Greece is an economy. You only have to look at the numbers to realize just how much the rest of the so-called “sharing economy” is left– comparatively– in the dust.”

The unicorn whisperers

Which investors are in the most unicorn companies and more importantly, which investors got into these companies earliest? Your daily dose of unicorn data is here.

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Article from SFGate.

It’s suddenly a lot harder for venture capitalists and startups to raise funds, as investors fed up with low returns turn their backs on the sector.

Most industry observers agree that lots of young firms will simply not be able to raise their next round of funding, commencing a period of belt tightening, consolidation and closures. At a minimum, it seems to mark the beginning of a more level-headed investment climate in Silicon Valley, after years of insatiable lust for all things mobile and social.

But if the drop-off is too sudden and steep, this new austerity could spill over into an economy highly dependent on the tech sector. Indeed, as The Chronicle reported last week, the industry has an enormous impact, with each tech job creating 4.3 indirect jobs in the community, according to a Bay Area Council Economic Institute report.

The investors and venture capitalists I spoke to insisted that we’re not on the verge of anything like the dot-com meltdown, characterizing the shift as a minor and healthy correction, or a “rationalization.” One suggested it was little more than the usual process of separating good and bad ideas in the marketplace.

But the numbers suggest something new is afoot. In the third quarter, the amount that U.S. companies raised in venture capital dropped 32 percent from the prior year, according to Dow Jones VentureSource. Venture capital funds themselves raised 17 percent fewer dollars from the second to third quarter, even as the number of funds grew, according to a joint report from Thomson Reuters and the National Venture Capital Association.

Economic uncertainty

Some partially blame the economic uncertainty surrounding the outcome of the election and the “fiscal cliff.” But the main problem seems to be that many of the “limited partners” that fund venture capital are pulling back after years of frustration.

Ever since a brief period in the late 1990s when venture capital burned bright, the industry has been delivering consistently weak returns on the whole.

In fact, despite requiring greater risks and larger capital outlays, venture capital has been underperforming the stock market over the past decade, according to a report this year by the Ewing Marion Kauffman Foundation.

Joe Dear, chief investment officer for CalPERS, told Reuters this summer that venture capital “has been the most disappointing asset class over the past 10 years as far as returns.” The huge pension fund for California’s public employees didn’t return repeated calls from The Chronicle.

Investment horizons have steadily spread out, from five to 10 to sometimes 15 years, as exit opportunities like acquisitions and initial public offerings fail to materialize. This has sometimes forced investors to put in more money to protect their initial funds.

‘Pretty grumpy’

“The industry definitely, for the last decade, has been a tough place to be,” said Ray Rothrock of Palo Alto venture capital firm Venrock. “We’re all pretty grumpy right now.”

Some of this is due to macroeconomic conditions outside the control of venture capitalists, notably the housing and banking crises. But at least some of it has to do with poor picks and herd mentality, funding companies with few real prospects and driving up the entry price for legitimately promising companies beyond what they could pay off.

“The market overfunded the number of companies in the system,” said Hans Swildens, founder of Industry Ventures in San Francisco. “There’s a glut.”

Even the grand promise of Web 2.0 companies that lured so much recent money hasn’t generated the hoped-for returns. The ones that managed to go public were often disappointments, including Facebook, Zynga and Groupon, in some cases leaving late-stage investors underwater on their holdings.

That was a final straw for some.

Last week, Forbes dug up figures from CB Insights that highlighted a wide and growing gap between the number of companies that raised initial funding and companies securing the follow-on investments, known as a Series A, generally necessary to keep going. This year, there have been 1,747 seed or angel rounds but only 688 Series A deals, underscoring the coming crunch.

Bad businesses

Based on as scientific a survey as the PR pitches in my inbox, there’s a tremendous number of silly, redundant and poorly executed companies out there that don’t warrant additional funding. The real problem isn’t that many of these companies won’t raise more money; it’s that they raised money in the first place.

For the venture capital industry to get back on track, it needs to embrace a renewed sense of discipline – on company picks, deal terms and total spending.

But hope springs eternal in Silicon Valley.

Rothrock stresses that the industry’s trend-line averages mask very strong results and ongoing investment at top firms, as well as growing venture capital activity among corporations like Google. Companies are just being more selective and looking beyond consumer Internet opportunities.

“We’re steady as she goes in terms of funding enterprise,” he said.

Secondary opportunity

Swildens oversees a secondary fund that buys shares from limited partners and venture firms looking to liquidate part of their holdings. He sees this period as a ripe opportunity for bold investors to get into promising companies at suddenly reasonable rates.

“Ours is one of the few firms aggressively putting money into these funds,” he said.

Mark Heesen, president of National Venture Capital Association, is similarly optimistic. He says the industry could be primed for a strong comeback in 2013, as long as the broader economy strengthens.

Above all, what the industry needs are some wins – acquisitions or initial public offerings that put investors clearly in the black and start to restore some lost confidence.

“If we see these exit markets start to generate good returns, I think you’ll see limited partners look at this asset class again,” he said.

James Temple is a San Francisco Chronicle columnist. E-mail: jtemple@sfchronicle.com Twitter: @jtemple

Read more here.

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