The WSJ published a recent chart of the 49 startups with billion dollar valuations. According to their research, there have never been as many privately held companies with such high valuations ever. The absolute number of these massively valuable companies alone is amazing. Ten years ago, most of them would have gone public by now. But what other insights can we tease from the data about these very special businesses?
First, the Billion Dollar Club (BDC) is nearly evenly split between Consumer and Enterprise companies, as the table below shows. I’ve noted the median dollars raised, the median valuation and the valuation efficiency in the table. The valuation efficiency is the valuation divided by the capital raised. This metric tries to answer the question, how much capital did the startup need to raise to achieve that valuation? This is a somewhat flawed metric[1] but I’m going to use it to compare the relative attractiveness of sectors[2].
Tomasz TonguzNegative Churn and Expansion Revenue
At Twitter, 10 percent of tech roles are staffed by women
At Facebook, 15 percent of tech roles are staffed by women
Cloud application services (SaaS) to reach $126 billions by the end of 2021
SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer
Publicly-traded SaaS companies have an average Revenue Per Employee of $200,000
SaaS solutions have the highest security features with 95% security failures due to human error
Companies with longer contracts (2+ years) reported the lowest annual unit churn
Growing faster has twice as much impact on share price as improving margins
More than two thirds of SAAS companies experienced annual churn rates of 5% or higher