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!
Lyft is the first Unicorn which published its S-1 document, i.e. its IPO filing. Is this good news or bad news? Lyft is impressive, two founders who were 22 and 23 when they co-founded their start-up 12 years ago have reached more than $2B in sales with a little less than 5’000 employees in 2018. This is the good part. The less good piece is it took the company more than $5B in equity investment and the reason is simple: Lyft has lost $900M in 2018, and more than $600M in both 2017 and 2016. This is more than $2B cumulative loss. I assume losses were pretty high in the previous years too. YOu can have a look at the cap. table I built from the S-1:
I read recently an article by Tim O’Reilly: The fundamental problem with Silicon Valley’s favorite growth strategy. O’Reilly has doubts about Reid Hoffman and Chris Yeh’s claiming that Blitzscaling would be the secret of success for today’s technology businesses. “Imagine, for a moment, a world in which Uber and Lyft hadn’t been able to raise billions of dollars in a winner-takes-all race to dominate the online ride-hailing market. How might that market have developed differently?” I have the same doubts about this crazy strategy but who am I to say?…
In the recent years, there had been regular filings in the biotech field, but IT had suffered. then Dropbox and Spotify filed and successfully went public. This probably gave confidence to “unicorns” and many have filed recently such as Smartsheet, DocuSign, Zuora. Carbon Black is the latest one with an interesting history. here is its S-1 filing and below my computed cap. table.
Carbon Black was founded in 2002, has raised close to $200M since inception (not counting the money raised by 4 startups is has acquired, Confer Technologies, Objective Logistics & VisiTrend). It has a royal list of VCs, including Kleiner Perkins, Sequoia, Highland, Atlas or lesser know funds such as .406 or Accomplice. I do not know who the founders were, but I could get the name of Todd Brennan who has left in 2008. Who else, help me! Finally the company is based close to Boston, not in Silicon Valley… This is just the latest of my compilations, that you may find in a previous post Equity in Startups.
I just read the news and as this is one of the long awaited filing, I make it short, here is the cap.table I guesses from the S-1 filing.
One quick note, the two co-founders, Andrew and Arash were 23 and 21 at foundation.
Drew Houston with Dropbox Co-Founder Arash Ferdowsi.
The price per share at IPO is a guess, it could go from $10 to $50 to more…
Thanks to the a16z weekly newsletter, I just discovered another interesting study about the importance of migrants in the US innovation landscape: Immigrants and the Billion Dollar Startups (in pdf). Here are some key findings:
– 51 percent, or 44 out of 87, of the country’s $1 billion startup companies had at least one immigrant founder.
– 62 of the 87 companies, or 71 percent, had at least one immigrant helping the company grow and innovate.
– immigrant founders have created an average of approximately 760 jobs per company in the United States.
Of course this is limited to the Unicorns, private companies with a rather young history, but these are impressive data.
If you have never read anything about the importance of migrants in Silicon Valley, you might also be interested in the work of AnnaLee Saxenian. Now, I copied the data from the study, to add my own comments:
In terms of geography, out of the 44 start-ups, 14 are based in Silicon Valley and 12 in close-by San Francisco.
In terms of education, out of the 60 immigrant founders, 23 have studied in the US universities, including 5 at Stanford and 1 at Berkeley vs. 4 at Harvard and 2 at MIT.
In terms of origin, the study gives the individual countries and I was interested at Europe: 15 come from the European Union vs. 14 from India and 7 from Israel.
Twenty years ago, I loved the Silicon Valley high-tech maps which were regularly printed. You could see the density of famous start-ups around Santa Clara, San Jose, Cupertino, Mountain View, Redwood City or Palo Alto, cities which would be unknown and uninteresting outside the technology world. Just have a look at some examples in the end of the post.
When playing with Banksy’s adventures in NYC, I used Google for building a customized map. And a few days later, I thought about doing the same for Silicon Valley unicorns. Remember the unicorns are the rare companies which reach a $1B valuation. According to the 2013 SV150 there are 94 such publicly-quoted companies. Too much for an interactive map. So I did the exercise with the $10B+ companies (I found 23 with their roots in Silicon Valley).
Choosing the market capitalization is debatable. I could have taken sales or profits. Companies such as Electronic Arts, Juniper, Xilinx, AMD, nVidia would have appeared but the group would have been similar. I just add to choose. You can open the map directly in Google maps for a better interface.
Diplay Technology companies on a bigger map
Again there is something fascinating about this density. People claim the center of gravity of the region is moving north to San Francisco because of the web 2.0. This remains to be seen over the long term…