Category Archives: Start-up data

A major update : data about 700+ startups

I regularly compile data about startups, mostly when they file to go public, when I can use their IPO prospectus (typically S-1 or 424B4 documents on Nasdaq). Thanks to a rush of IPOs this year (despite the covid) but also by revisiting older filings thanks to Jay Ritter great database of 11000+ IPOs since 1975, I could recently increase my own (much smaller) database of cap tables to 716 former technology startups (from 600 startups last April). This is a 20% or so increase, so it is quite a major update. Here is the document of all individual cap. tables:
Equity List – Lebret – Nov2020

You may prefer to download the pdf. And before reading the rest of the post, you may be interested in the analysis of the 600 startups last April : Updated data in equity of 600 (former) startups.

I will not go into the details of the data analysis, which would no doubt be similar to the 600 startups of last April. You can find the new stats beginning page 729 of the pdf. The evolution of the figures by period of 5 years is striking. It undoubtedly shows in part the evolution of the importance of technology but also the influence of venture capital in growth strategies. For better or for worse as I said in my previous article and as Philippe Labouchère said very well in Le Temps: These mega-investments that distort reality (Ces méga-investissements qui déforment la réalité).

Don’t be misled by the drop in the 2015 period. These very young companies who filed to go public are mostly biotech companies which have sligthly different dynamics. The IT companies which will file in the next years will be interesting to analyze: we’ll see if the trend continues or collapses…

One final element. Out of the 716 companies, 274 have been acquired and 383 are still public. The average M&A value is $3B and the median is $600M (remember the statistics of startups are not gaussian but follow a power law, a kind of “winner takes all” situation). Here is the list of the main acquirers:

Covid-19 Startups : BioNTech and Moderna

Yesterday I posted about Airbnb IPO filing here and in a few weeks or months I will update my 600-startup cap. tables to 700. A major upgrade. In the mean time, even if I am not a specialist at all of biotechnology I study some startups of the field from time to time. You can check the tag #biotech for example or a post about Crispr startups. It would have been difficult not to notice recently two other startups which went public recently, Moderna in 2018 and BioNTech in 2019, because of Covid19. Look at their recent stock history when they annouced a vaccine against the virus:

Maybe have a quick look at their cap. table below but first some comments: Moderna had been founded in the Boston area in 2009 and BioNTech in Germany in 2008. Their revenues (and losses) were large at time of filing. A lot of venture capital (which owns 60% of both startups), many employees. Not young founders (46 and 60 at Moderna, 41, 43 and 64 at BioNTech). You can add any comment you want, if any…

In reality, these figures are not that different from those of the giants of the digital world in yesterday’s post, except one maybe, the founders’ age.

Airbnb files to go public – the last giant?

Airbnb just filed to go public. Finally! It maybe the last IPO of the recent giants (and not the latest only), these giants which emerged in the 21st century, such as

and of course is the cap.table, not that far from what I had tried to guess in 2017 in www.startup-book.com/2017/03/13/what-is-the-equity-structure-of-uber-and-airbnb/

The Microchip Revolution (Appendix) – Intersil

As I mentioned in my previous post, I was a little desperate to find specific information about Intersil that would allow me to illustrate its shareholding when it went public.

You can skip this very anecdotal narrative which is probably above all an archive for me, but which also shows that you always have to persevere. Note that each country has a register of companies, more or less rich in information, sometimes for a fee, sometimes free. In the USA, the Security and Exchange Commission (SEC – www.sec.gov) provides access to all documents about public companies (i.e. listed on a stock exchange). In contrast, private companies (not listed on a stock exchange) are not obliged to publish any information, especially financial. (And I would add that Private Equity – of which venture capital is a part – only finances private companies, i.e. unlisted).

The SEC provides a service – EDGAR – free of charge for all documents published up to the mid-1990s, 1996 to be precise, I think. The SEC sold the pre-1996 documents for around $40-60 and then handed the service over to Thomson Reuters (then Refinitiv) a few years later – a privatization of “public service” and the price rose to $80 then $120-140 per document…

On October 4, I contacted Thomson Reuters asking for the IPO prospectuses of IDT, Lam Research and Intersil.

While I got the first two almost immediately, on October 7 I got a question as an answer for Intersil that asked me to choose a document from the following table:

The question was unsettling because Intersil was not Harris and I wanted a document dated 1972. There should not have been earlier documents.

Intersil was founded in 1967, went public in 1972 and was reportedly acquired in 1981 by General Electric (GE) and in 1988 by Harris (that’s it!) which combined Intersil with units from RCA and GE. In 1999, Harris made Intersil a spin-off which went public again in 2000… In 2017, Japanese company Renesas bought Intersil.

In explaining this situation to the SEC, a second research led them to offer me these documents:

Buying 2 documents at that price made me hesitant. So I needed more information. I contacted individuals:
– Christophe Lecuyer, author of Making Silicon Valley, Innovation and the Growth of High Tech, 1930-1970
– David Fullagar, formerly at Intersil,
– Michelle Lowry at Drexel University,
– Josh Lerner and Paul Gompers at Harvard University,
– Jay Ritter at University of Florida,
as well as institutions:
– The Computer History Museum in San Jose, CA (https://computerhistory.org/)
– The libraries of Stanford University, Harvard University
– The WRDS service at Wharton (Wharton Research Data Services), the business school of the university of Pennsylvania

Most answered even if they had no information. This is the American culture: people try to help, often by giving new names or leads. I must in particular thank Jay Ritter who wrote back immediately: “My records have Intersil going public on Jan 20, 1972 at $14 per share. The first market close may have been $12.00. But I have less information about this company than most IPOs from 1972.” then later “In another file I found that it had ticker ISIL, listed on Nasdaq, might have been a General Electric spinoff, but was VC-financed with Diebold Venture Capital Corp., RCA Corp., Sutter Hill Ventures, Bessemer Venture Partners, Mayfield II, Citicorp Venture Capital, and Small Business Enterprises (Bank America) as investors, Bache was the lead underwriter, and sold 360,000 shares at $14 per share (352,000 newly issued, with 8,000 from selling shareholders).”

Interestingly there are mixed information about 2 different IPOs not to say companies. But I had my date! January 20, 1972.

On October 11, I could contact again Refinitiv and my contact answered “Please allow at least 2-3 hours for this process.” The next day, “They need to scan the microfiche for the document of Intersil. [But] it seems that they are having trouble on finding it.” And the next day, I finally had it which made possible the next table:

Remember Bauer and Wilder have dedicated their book to Jean Hoerni : “This book is dedicated to Jean Hoerni, the inventor of the planar process; without which none of this would have been possible. Hoerni became an entrepreneur and owned about a quarter of Intersil IPO. This is uncommon and huge for a founder. You my not know the investors, this was the sixties. But Arthur Rock is a legend (an investor in Intel, Apple – see my next post!) and Fred Adler is also famous, though to a lesser extent. These were the early days of startups and venture capital, but fundamentally, everything was being invented then and the rules are pretty much the same today.

A Fury of Software IPO Filings

After many, many IPO filings from biotech startups in 2020 (I counted 20 out of the 43 I followed and made cap. tables of), the end of August had 8 filings from Software companies (and only 15 in total). I do not think there is any rational here (except maybe Palantir as a trigger), but I decided to have a look at these 8 companies.

These are
BigCommerce (Australia)
Palantir Technologies (see my previous post here)
Asana, Sumo Logic, SnowFlake (Silicon Valley)
Unity Software (Denmark), Jfrog Ltd (Israel)
AmWell (Boston)

You can have a look at some cap. tables in the pdf (pages 633, 636-42) but more than the individual data (also below at the end), it is the (limited) stats which I find interesting:

The data deserve some explanation and also deserve to be compared with the averages of the more than 600 startups studied in the pdf (pages 644-659).

These “young” startups took 12 years to go public, this is much more than in the (recent) past and they used amazing amounts of venture capital, in the hundreds of millions. Even the series A, the 1st round, is huge, about $10M. Their sales are big too (more than $100M for all of them) with a mediam value of $150M. Their losses are not small with a median value of $100M…

Now If we look at shareholding, investors own about 45% of the company, not more than in the past (despite the huge fund raising), IPO shares are pretty small (about 4%). Common shares (mostly employees) is about 35% and you should also notice that these startups have hundreds not to say thousands of employees. As a side comment non-founding CEOs are not the norm and have about 3.5% of the company (CFOs have about 0.7%)

The founders keep about 14%. They are about 2 per company, with a median age of 35 (mean is 33 so slightly lower than the overall 38.

I think all this is pretty interesting and feel free to have a look at overall stats in my post earlier this year: data about equity in 600+ startups.

Equity List August2020

 

Palantir files to go public

I am not sure this was worth a post as there is nothing really surprising with Palantir IPO filing that can be found here on the NASDAQ website. Still, this is Palantir, the secretive software company cofounded by Peter Thiel, Alexander Karp & Stephen Cohen (as well as Joe Lonsdale and Nathan Gettings)


Thiel, Karp, Lonsdale & Cohen (Gettings cannot be found online)

So I did my favorite exercise, building a tentative cap. table. Here it is:

What are the striking facts: the high level of sales, losses and fund raising. The startup, neither its founders are not young anymore… That’s it. Or feel free to comment!

Equity sharing in startups – a presentation

A few days ago, I had the opportunity to present a video conference on equity sharing in a startup, between founders, investors and employees. I’ve done it many times in the last few years like the one Slideshare here, but I had never recorded it. It’s now done:

As archive, the Slideshare presentation…

The other links

600 capitalisation tables: https://www.startup-book.com/2020/04/06/updated-data-in-equity-of-600-former-startups/

Universities and equity ownership in startups : https://www.startup-book.com/2013/11/05/how-much-equity-universities-take-in-start-ups-from-ip-licensing/

Startups and titles : https://www.startup-book.com/2019/12/11/titles-in-start-ups/

Penny Schiffer’s Tweet : https://twitter.com/PennySchiffer/status/718323492006076417

Slicing pie : https://slicingpie.com/

Pie calculator : https://www.andrew.cmu.edu/user/fd0n/35%20Founders%27%20Pie%20Calculator.htm

Two additional lists of references I just found thanks to Penny Schiffer: Useful resources for (present and future) investment analysts — Part 1 and Part 2

The dark and mysterious side of British unicorns : Darktrace Ltd

My naive and obsessive quest for startup cap. tables has led me today to a thriller-like research! First I will let you have a look at Darktrace cap. table which I decided to study as it belongs to the short list of UK unicorns together with Revolut and Graphcore.

Well the first surprising information is the founding structure, ICP London. Why a British Virgin Islands structure? To hide who the founders are? Then I discovered surprising board members, Michael Lynch, the founder of Autonomy and Sushovan Hussain, the former Autonomy CFO… Autonomy was always a puzzle to me before becoming a scandalous HP acquisition and then the cause of a huge trial, not decided yet… And in law, you are innocent unless proven guilty.

Another strange side of the company is its links to secret services, MI5, CIA, NSA. Probably not so surprising when your industry is cybersecurity… Being based in Cambridge, it is not surprising that many Darktrace employees were at Autonomy before. The board members I did not know, but the investors are famous: Summit, KKR, Insight. Less maybe is Invoke Capital board members Vanessa Colomar and Andrew Camper. Lynch and Hussain are not on the board anymore and this is probably linked to the HP Autonomy litigation.

Then I got it: Invoke Capital Partners… ICP! So Darktrace was indeed founded by the former Autonomy people and its new investment structure, Invoke. I had to do a little more search and found two quite fascinating articles:

Skeletons In The Closet: $2 Billion Cybersecurity Firm Darktrace Haunted By Characters From HP’s Failed Autonomy Deal, a remarkable enquiry published in Feb. 2020 by Forbes staff member, Thomas Brewster.

And 2019 Darktrace and Autonomy: tracking down all the money and CEOs published in Dec. 2018 by Luca Kosev is nearl as good!

Worth reading. Enjoy!

Two new British startup cap. tables: Autonomy and Bicycle

I recently published an updated version of a database of capitalization tables of 600 (former) startups. I obtain the data most of the time from the IPO prospectus of the company (that is the document the company publishes when it is listed on a public stock exchange, and in general Nasdaq.

These documents are an amazing source of information of all the business components of the companies even if I focus only on the shareholding and funding history. They are sometimes a little frustrating though as they do not cover the full history of the company, but only 3 to 5 years in the past so it is not simple to get the founders’ data for example.
Some countries do however provide access to the full company data, often for a fee like in France. A few cantons in Switzerland (Basel, Zurich) and the United Kingdom provide it for free and this is just great.

I have done some research for Revolut and Graphcore recently. Today, I revisited the data I had built for two British companies: Autonomy founded in 1996 and had gone public on Easdaq in 1998 and Bicycle Therapeutics, a biotech company with links to EPFL (Lausanne, Switzerland) founded in 2009 and public since July 2019.

The IPO documents did not provide enough for me about the founders and early rounds. So here are my new tables:

Autonomy

Bicycle from the IPO data

Bicycle from the UK register data, the updated cap. table, the funding rounds and its growth over time:

The funding rounds


The growth of revenues and jobs

Data about equity of 600 startups – comments (7)

A final post (for now) about the data about 600 (former) startups. So what have they become today in April 2020?

First a quick point of caution: I counted some companies twice, because I had looked at their equity strutcure at different points in time: Alibaba had two IPOs in 2007 in HK and 2014 in the USA, Esperion had 2 filings in 2000 and 2013. This is not a big deal, except if you count Alibaba’s value twice!

So out of the about 600 former startups, I found that
– 20 were still private (they may have recently filed for IPOs though)
– 12 were private again after an IPO
– 13 had stopped their activity (often through bankruptcy)
– 225 had been acquired or merged with another company (Merger and acquisitions – M&As)
– 331 were still public.

So let us have a closer look at M&As and public companies:

On the M&A side, the main acquisition value comes from biotech, with a $5B average value whereas software or internet is a little les below $3B.

On the public side, I will let you discover depending on your interest about, given the field, the number of companies, employees, cumulative market capitalizations, sales, profits, then age of companies and current average price to sales (PS), price to earnings (PE) and an interesting personal metrics, price ot employees in $M (Pemp).