Do you remember the headlines about VC investment "falling off cliff" after some data was reported by NVCA in early April? We took a contrarian view, saying the trend was down, but challenging the doom and gloom that was jumping from the headlines. This was based on our own online research and some anecdotal data from interviews. Fred Wilson at Union Square Ventures also dug a bit deeper. The more we looked into this, the more we saw that the underlying data was not as authoritative as one might imagine. Many people popped up in the comments offering additional data. One was a New York City-based startup research firm (founded as recently as February 2009) called ChubbyBrain (great name!), which tracks this kind of data for a living. So this month, we relied on ChubbyBrain to help us dig deeper and get you the facts.]]>
Healthy Month-to-Month Trend
Month-to-month growth and growth percentage in parentheses:
- January: $30.3 million
- February: $45.5 million ($15.2 million, 33%)
- March: $55.7 million ($10.2 million, 18%)
- April: $73.7 million ($18.0 million, 24%)
If these were the revenues of Web Tech Innovation Inc., the CEO would be pretty happy.
Cautionary note: the research methods vary from Q1 (our own) to April (ChubbyBrain's). Because ChubbyBrain has a more comprehensive research method, it is almost certainly finding more deals than we did.
In Q1, our own research came up with numbers that were in the same ballpark as the MoneyTree (TM) Report from PricewaterhouseCoopers (PwC) and the National Venture Capital Association (NVCA), based on data provided by Thomson Reuters. Because we saw that report as the benchmark, we thought our own research was okay. The readers who pointed out how much we missed forced us to challenge that assumption.
(In April we excluded international deals, so this is comparable to the data reported by NVCA, which is US only.)
California Under 50% of Total
California is the biggest state in both deals and dollars. No surprise there. But California is no longer the only place to go. In fact, in April, California accounted for less than 50% overall (41% in deals and 49% in dollars).
What's Happening in Georgia?
But the big surprise is Georgia, with three reported deals, and good-sized deals at that:
- Eucalyptus Systems ($5.5 million)
- Psydex ($3.5 million)
- Reflex Systems ($8.5 million)
The other surprise was the three deals from Washington State, but all quite small: Foodista, LookStat, and TalentSpring.
Which Ventures Received Money?
This list includes only comapnies that (a) are US-based, (b) are in Web technology, (c) closed Series A deals, and (d) reported the amount. If we missed any, please tell us in the comments.
- AutoVirt, Inc.
- Basho Technologies
- Booyah
- Eucalyptus Systems
- Everbridge (formerly 3n Global)
- Foodista
- IMshopping
- Jodange
- LookStat
- Media6°
- Psydex
- Reflex Systems
- Schooner Information Technology
- Socialcast
- TalentSpring
- Tripbase
Which VCs Wired Money?
- ABS Ventures
- Amazon
- Benchmark Capital
- Big Red Ventures
- BV Capital
- CMEA Capital
- Contour Venture Partners
- Founders Co-op
- Harbor Island Equity Partners
- Intercontinental Exchange (ICE)
- Kepha Partners
- Kleiner Perkins Caufield & Byers
- Redpoint Ventures
- RFA Management Company
- Second Avenue Partners
- Sigma Partners
- SK Telecom
- True Ventures
- US Venture Partners
- Venrock
- Wilmington Investor Network
About Our Research Partner, ChubbyBrain
Launched in February 2009, ChubbyBrain is a New York City-based information services provider that democratizes startup and investor information.
We found them via the comments in our last post on this subject. After a few conversations with Anand Sanwal, the founder, it was clear that ChubbyBrain was serious about shining a light on an area that needed more transparency. So, it made sense to partner with them to get the data that we needed to understand the trend lines.
It feels like we are still seeing only the tip of the iceberg. We want a lot more global data and more angel data. But we are confident that ChubbyBrain is as committed as we are to shining a light on the flow of risk money into Web innovation. It is such an important subject.
From the Department of Old Journalistic Metaphors
With any luck, April showers will bring forth May flowers... those flowers being the rewards that these investors will pluck in five years' time.
But in this game, we need it to rain continuously. So, we look forward to seeing what the May investment numbers tell us. Stay tuned.
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