
It's tough to be a startup in the daily deals space these days. To quantify some of this, CB Insights has released a report covering valuation multiples for both M&A and venture financing for daily deal startups. It's not a pretty picture as valuation multiples of both price per subscriber and price per voucher are dropping quickly. Yesterday, The Wall Street Journal (courtesy of aggregator Yipit) reported that nearly one-third (170 out of 530) of all daily deal sites have been shut down or acquired. If you blend the Yipit Data with the CB Insights data it looks like 98 have been shut down and 72 have been acquired. (Of course this is two separate data sets so you have to be careful but it's probably directionally accurate.)

While certainly not every business needs to raise venture financing, it is the path for many high-growth technology startups. Therefore, going down the fundraising path is something many technology entrepreneurs will need to do and is a critical step in the development of their business. This can be an intimidating experience so I've put together a list of five tips for raising a venture round. This is by no means an exhaustive list so I'd love to hear other suggestions from you in the comments of this post.

The number of daily deal sites is growing at an amazing rate. Recent data from daily deal aggregator Yipit, shows there are now over 480. The number has grown by almost a factor of 10 over the last year (chart below).
Entrepreneurs definitely have become interested in this model. The largest, Groupon, is actually being studied by some leading academic researchers. We thought it'd be worth summarizing five interesting observations from this research.

As an entrepreneur it can be dizzying to watch Groupon and Living Social grow so quickly, raising huge venture rounds at massive valuations while contemplating multiple billion dollar acquisitions and IPOs. While certainly this is something even the most disciplined founders find themselves dreaming about, the experience is such an outlier it's not something you can build projections from. However, I do think there is one key lesson entrepreneurs should look at - we are moving into a new "default business model" for consumer software that many of the fastest growing startups are applying to their business.
While most consumer software over the last few years was commercialized by serving advertisements (and before that by charging licensing fees) increasingly I expect consumer technology to be commercialized by enabling purchases and taking a percentage of the transaction over the next few years.
Ideally, you'll find some time over the next few weeks to curl up with a good story. Or hey, at least that's what I look forward to on vacation. If you are looking for some books on entrepreneurship to read, or even to gift, here are some recommended books from 2010. There were a number of great business books published this year, many of which we reviewed here as part of ReadWriteWeb's "Weekend Reading" series. But here are a few of the standouts, startup books we've chosen specifically because they are such great stories:
The mission of TED (Technology Education Design) is to promote "ideas worth spreading." And as such, there is plenty of material that entrepreneurs - folks definitely interested in spreading their ideas - can find inspiring in the recordings available on TED's website.
We've gone through the archives and hand-picked some of our favorite TED talks for startups. Granted, it's hard to select just ten to feature here out of the 700-some-odd videos available. So if your favorite isn't listed, be sure to leave us a comment.
Internet analyst Mary Meeker from Morgan Stanley presented a report on Internet trends at Events@Google yesterday. Echoing those trends identified in her 2009 presentation, the report focuses on the rapid and continued growth of the mobile internet and social networking. Claiming that the world has entered the fifth major technology cycle, Meeker predicts that this cycle will be marked by the adoption of mobile Internet technologies, as the trends of "3G + Social Networking + Video + VoIP + Impressive Mobile Devices" converge. Meeker predicts the mobile Internet will be bigger than desktop in five years, noting that by comparing iPhone and iPod touch versus AOL and Netscape users, that mobile Internet is ramping up at a rate far faster than desktop did. Furthermore, she argues that 3G coverage has reached a global inflection point, meaning it is available to at least 20% of the world's cellphone users.
Less than a decade ago, online dating was by no way considered mainstream. Not only were you judged for putting your profile up on a dating site, but your choice of site between Lavalife, Match and Nerve Singles told others whether you were there to date, get married or make friends with benefits. Today, location-based dating sites are quickly gaining ground. With the increasing mainstream acceptance of services like Foursquare and Gowalla, new opportunities within the dating space have emerged. Forget badges and points, geo-locational apps already have the power to promise you love.
It's no secret that we at ReadWriteWeb have a lot of love for startups that make their homes outside Silicon Valley and the Bay Area.
We've decided to make a few videos spotlighting some unique, unexpected locations where startups thrive, where tech scenes are vibrant, where cooperation outstrips competition, and where creativity runs rampant. One of the first cities we'd like to introduce you to is home to between 150 and 170 startups as well as a thriving entrepreneurial and creative community. Welcome to Boulder, Colorado.
This is one post/chapter in a serialized book called Startup 101. For the introduction and table of contents, please click here.
Google the phrase "Are you an entrepreneur?" and you'll get a lot of help thinking through what should be the first question you ask before starting a new venture. Because entrepreneurs are a busy bunch, we've compiled a top 10 list right here.