To begin with, it is important to think from the standpoint of startup owners — they outnumber the investors, and at the global stage of entrepreneurial finance, this reality means more fierce competition. As per Gust, only one startup out of 400 manages venture funding and those who admire raw data like I do, know that numbers never lie.
Now, most startups usually receive venture backing after several rounds of initial seed funding, which makes the seed investment market really vital for budding entrepreneurs. Seed investors and accelerators fund, polish and refine startups to the point they are shiny enough to grab the attention of the big VCs and secure funding, enter big waters and scale up.
VCs might receive hundreds or even thousands of investment applications from startups every year, and still only a handful of names make it to the end. This is why good seed investors are very important. Let’s see some of the most active and successful investors to be wooed in 2015 during seed, early stage and later stages of venture funding.
Seed funding stage
According to the Crunchbase Investor Leaderboard, the top ten investors have collectively made 170 investments at the seed funding stage in 2015 already. 500 Startups sits on top at 26 investments followed by Y Combinator and TMCx Accelerator with 21 investments each, while Social Starts wrapped up the top four with the counter at 20.
1. 500 Startups
Investments made: 26
Notable projects: InnovAccer, Headout, Studypool, Gymtrack, Shoppr, HijUp, Iterable, BlockCypher, Cleanly
2. Y Combinator
Investments made: 21
Notable projects: Smarking, Direct Match, EquipmentShare, Razorpay, Roomstorm (Formerly WalkSource), Chariot, One Signal
3. TMCx Accelerator
Investments made: 21
Notable projects: Skylit Medical, SageHealth, Seratis, SemanticMD,Oxitone, NanoLinea, Medical Adhesive, DIBS, iShoe, Braincheck
4. Social Starts
Investments made: 20
Notable projects: CodeFights, Stratifyd Inc DBA Taste Analytics,LLC, A Plus, VaporChat, Clover, Fabric, Chloe, StrongDM
Investments made: 17
Notable projects: MightySignal, Naritiv, Stream.io Inc, Cartesian Co, StyleSage, OneModel, Red Fox Clan, FantasyHub
Top Pick: With over 800 investments in 650 companies till date and US$256 million funds raised, the Mountain View-based 500 Startups is the hottest seed investor in the finance and startups category at the moment. It is an early-stage seed fund and incubator program focused on consumer and small to medium sized Internet startups, and was founded by ex-Google and ex-PayPal folks.
Mobile, e-commerce and curated web startups attract most of the 500 Startups’ funding.
Early stage venture funding
The year 2015 is brimming with confidence when it comes to startup investments – seed, early or later funding phases. As many as 223 investments have been made by the top 15 Crunchbase early venture funding stage investors this year. Sequoia Capital, Accel Partners and Andreessen Horowitz are some of the most active names.
1. Sequoia Capital
Investments made: 31
Notable projects: PlanGrid, Pocket Gems, Grofers, Blue Danube Systems, PepperTap, Vulcun, MobiKwik, Beequick, DoorDash
2. New Enterprise Associates
Investments made: 24
Notable projects: Intact Vascular, Moximed, RobinHood, CRISPR THERAPEUTICS, FiftyThree, Mersana Therapeutics, Pocket
3. Accel Partners
Investments made: 16
Notable projects: Gametime, Vedantu, eduK, DJI, Visual Supply Co (VSCO), WorldRemit, Teabox, Raise Marketplace, Jet, Deliveroo
4. Andreessen Horowitz
Investments made: 16
Notable projects: Affirm, AltSchool, Improbable, Honor, Tachyon Nexus, Pindrop Security, Highfive, Earnest, SignalFx
5. First Round
Investments made: 15
Notable projects: Aviso, Inc., AltSchool, Looker, Twenty20, Reserve, The Black Tux, Earnest, Boxed, Ringly, Koru
Top Pick: Sequoia Capital has so far made 877 investments in 529 companies and raised a whopping US$3.1 billion. It is one of the biggest VC sharks and a pretty successful one at that. They are mostly active in China, India, Israel and United States, with a lot of interest in diverse industrial sectors, such as energy, enterprise, financial, healthcare, Internet and mobile.
If your startup is ready to enter the big waters and is in need of early stage venture funding assistance, then the Sequoia Capital crew is probably the one you need to woo this summer.
Late Stage Venture Funding
The later stage venture funding market is even more aggressive this year with top 5 investors pulling off 160 investments five months into 2015.
1. Kleiner Perkins Caufield & Byers
Investments Made: 40
Notable projects: SessionM, Bloom Energy, Telogis, Slack, InsideSales.com, SimpliVity, Ayasdi, Shazam Entertainment, Stance
2. Sequoia Capital
Investments made: 35
Notable projects: MarkLogic, Percolate, Docker, Zomato, Urban Ladder, To8to, Birst, Cheyipai, Endochoice, Cardekho, Ele.me, Freecharge
3. Goldman Sachs
Investments made: 35
Notable projects: Pinterest, Foodpanda / Hellofood, Docker, Quixey, ScienceLogic, MongoDB, Tikona Digital Networks, IHS Holding, Cloudary
4. New Enterprise Associates
Investments made: 28
Notable projects: Mirna Therapeutics, Naaptol, Cohere Technologies, Onshape, Moda Operandi, ScienceLogic, Bloom Energy
5. Oak Investment Partners
Investments made: 22
Notable projects: Tikona Digital Networks, Good Technology, Circle, Precision for Medicine, Protean Electric, NanoH2O,MapR Technologies
Top Pick: The Menlo Park-based VC group, Kleiner Perkins Caufield & Byers (KPCB), has a phenomenal track record — 655 investments in 368 firms and a total raised capital of US$2.8 billion. As early investors of many tech giants, such as Amazon, AOL, Compaq, Google and Sun Microsystems, this group is the dream of most entrepreneurs, since they spell nothing but success and greatness.
Primarily focused on the United States market, KPCB is attracted to emerging clean biotech and clean technology companies.
Key takeaways: Startup funding trends for Q1 2015 from Gust
- The global startup scene started out with full steam in 2015, thanks to a strong 6.9 per cent surge in funding applications over Q4 FY14-15. Interestingly, the maximum growth at 13 per cent was contributed by startups in the “Idea Stage”.
- United States remained the top place with a 5 per cent jump in funding applications during the Q4 2014-15. The Indian startup scene continues to attract a lot of attention and managed to displace France as the number two.
Disclaimer: The Crunchbase data was collected between 17-18 May, 2015.
Photo Credit: Entrepreneur.com