Private company up & comers march 2012 - soho loft

March 2012

Private Company Up & Comers

Copyright 2011 HighStep Capital. All rights reserved.

Private Markets are Getting an Overhaul

VC Super Angels

Accelerators

Crowdsourcing

Private market funds


Changes in the Funding Cycle

Seed

Traditional F&F Series A Series B Series C Series D Series E

Recent

Very Recent

Path 1 VCs VCs

Path 2 Angels Angels

Secondaries

Angels

VCs

Secondaries

AngelList SecondMarket

Early Stage Late Stage

Angels Series A/B Series C/D


Time to Exit has Increased

0

2

4

6

8

10

12

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Median Age at IPO

NVCA, Jan 2011


Why Companies Mature Before an IPO

Sales # of IPOs Avg 1st Day Return Avg 3yr Return

<$50m 3,897 23.60% 5.00%

$50m+ 3,457 12.00% 39.10%

http://bear.cba.ufl.edu/ritter

IPO research from Prof. Jay Ritter, University of Florida – as of 6/1/11

IPO performance from 1980-2010


The IPO Gap Creates the Opportunity

1 2 3 4 5 6 7 8 9 10

VC IPO GapPublic

Markets

• Buyers & Sellers Maturing

• Ecosystem Emerging

• Laws Developing


Private Company Emerging Stars


Network Based Business Models


ZocDoc – The OpenTable of Doctor’s Offices


ZocDoc Stats


Klout – branding people


Klout - People become Brands


Polyvore – Pinterest for shopping


Polyvore Stats


CouchSurfing – Craigslist for travelers


CouchSurfing Stats

Couchsurfers: 3,867,883

Successful Surfers: 4,221,367

Friendships Created: 4,165,046

Positive Experiences: 6,752,847

Unique Countries/Territories Represented: 251

Unique Cities Represented: 85,760


WhaleShark Media – coupon network


WhaleShark Media Stats


Shopkick – Local & Mobile Couponing


Shopkick Stats

•1 billion in-app deals and offers viewed

•3 million active users just over a year since launch

•5 million walk-ins to partner stores in December 2011,

doubling in just four months

•10 million product scans, up from 7 million in August

2011 and 3 million in February 2011

•Sixty-four percent of all shopkick users are now

women. More than half of female users have kids

•The average shopkick user is 30 years old. Less than

8% of all users are younger than 18


Lytro – focus later


Lytro Description

Lytro is developing a new type of camera that

dramatically changes photography for the first time

since the 1800s. Rather than just capturing one plane of

light, it captures the entire light field around a picture,

all in one shot taken on a single device. A light field

includes every beam of light in every direction at every

point in time. Experimentation in this field started in the

mid-1990s at Stanford with 100 cameras in one room.

Lytro’s innovation is making it small enough to fit in

your pocket. Really.


Kiva Systems – Robotic Fulfillment


Kiva Systems Adoption


Palantir Technologies – Big Brother is watching


Palantir Stats

2010 Revenue: “significantly north of $80m” http://goo.gl/aABcz

2011 Revenue: “on track to hit $250m” http://goo.gl/egv7x

“there is a clear path to hit $1b in revenue within 5 years” http://goo.gl/cqE9N

Capital Raises:

Seed: 2004 Peter Thiel

Series A: $10.52m - November 2006 In-Q-Tel & Individuals

Series B: $36.75m – March 2008 In-Q-Tel, Reed Elsevier Ventures

Series B2: $8.29m – April 2009 Individuals

Series C: $34.9m – November 2009 Undisclosed Venture Firms & Individuals

Series D: $90m – June 2010 Founders Fund, Glynn Capital, Ulu Ventures, Individuals

Series E: $50m – May 2011 Founders Fund, Undisclosed VC

Series F: $68m – September 2011 Founders Fund

Total: $300m

http://goo.gl/aABcz

http://goo.gl/aABcz

http://goo.gl/aABcz

http://goo.gl/aABcz

http://goo.gl/aABcz


better place – battery switching stations


BranchOut – the LinkedIn of Facebook


Branchout Stats


Stella & Dot – the next-gen Mary Kay


Stella & Dot stats

2009 Revenues: $33m

2010 Revenues: $104m

2011 Revenues (expected): $300m

5 Years Revenues: $1b

“It’s a nice business with very little paid-in capital. It’s gotten to $100

million and is a very profitable business in a short period of time. I

look forward to making it a standalone company for many years. I’m

very excited to work with her and the team.”

Sequoia Capital Partner Alfred Lin, who was most recently

chairman, COO and CFO of Zappos.com.


Foodspotting – social discovery through food


What’s up With Food Photography?


Cheezburger – stupid stuff that people share


Cheezburger – stupid stuff that people share


Cheezburger Overview

Cheezburger, the company behind popular sites such as

I Can Has Cheezburger?, FAIL Blog, Memebase, and

The Daily What. The Internet media publisher counts a

passionate fan base of 16.5 million people who upload

more than 500,000 pictures and videos as well as view

375 million pages and 110 million videos each month.

Cheezburger has been profitable since its inception with

revenue from three sources of advertising, traditional

media publishing including books, and merchandising.


Market Observations

• The Internet is huge & growing, which makes

your odds of success very high

• The Internet is filled with great niche content

• The Internet is very international

• Winning strategies are all about network effects so

get big as fast as possible – (ie, photo sites)

• Most of the great online products are derivatives

of great offline products

• The depth and quality of companies is amazing

New York | San Francisco

Jason Jones

[email protected]

914.315.9751

@cardinalrose

http://www.slideshare.net/jjones23

http://www.slideshare.net/jjones23

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Private company up & comers march 2012 - soho loft

Economy & Finance