Financial Technology Startup Highlights  – Q1 2018

Here is our Q1 2018 summary report on the Financial Technology startup sector. The following report includes an overview, recent activity, and a category deep dive.

To learn more about our complete Financial Technology report and research platform, visit us at www.venturescanner.com or contact info@venturescanner.com.

3D Printing Startup Highlights  – Q1 2018

Here is our Q1 2018 summary report on the 3D Printing startup sector. The following report includes an overview, recent activity, and a category deep dive.

To learn more about our complete 3D Printing report and research platform, visit us at www.venturescanner.com or contact info@venturescanner.com.

Retail Technology Sector Overview – Q1 2018

The Retail Technology sector includes companies that facilitate the operational procedures of retailers. It also contains companies that make it easier to search and shop for merchandise.

What are the different components of Retail Technology? How do they make up this startup ecosystem? On our retail tech research platform, we have classified the companies into 21 categories. This blog post examines these categories and how they compare with one another.

Marketing Platforms Is the Largest Category

Let’s start off by looking at the Sector Map for the Retail Technology sector. As of March 2018, we have classified 1,746 Retail Technology startups into 21 categories. They have raised $59 billion in funding. The Sector Map highlights the number of companies in each category. It also shows a random sampling of companies in each category.

Retail Technology Sector Map
Retail Technology Sector Map

We see that Marketing Platforms is the largest category with 245 companies. This category includes companies that enable merchants to execute and manage marketing campaigns. It also contains customer relationship management tools used to improve customer engagement. Some example companies in this category include Showpad, Sprinklr, Gainsight, and Medallia.

We have seen the Retail Technology categories and the number of companies in each. What about their funding and maturity in relation to one another? Let’s look at our Innovation Quadrant to find out.

Marketing Platforms Is the Heavyweight Category in Retail Technology

Our Innovation Quadrant divides the Retail Technology categories into four different quadrants.

Retail Technology Innovation Quadrant
Retail Technology Innovation Quadrant

We can see that Marketing Platforms is in the Heavyweights quadrant. Heavyweight categories have reached maturity with large amounts of funding. 11 categories are in the Established quadrant for reaching maturity with less financing.

4 categories are Disruptors, acquiring significant financing at a young age. The final 5 categories belong in the Pioneers quadrant. They are in the earlier stages of funding and maturity.

We’ve now seen the Retail Technology categories and their relative stages of innovation. Marketing Platforms emerges as a key category. It leads in total companies and appears in the Heavyweights quadrant. Yet how does its funding stack up against other categories? Let’s look at the Total Funding and Company Count Graph.

Last Mile Logistics Startups Have the Most Funding

The graph below shows the total amount of venture funding and company count in each category.

Retail Technology Total Funding and Company Count by Category
Retail Technology Total Funding and Company Count by Category

As the above graphic implies, the Last Mile Logistics category leads in funding. Its $13 billion in funding is almost 50% higher than the next category, POS Payments.

Last Mile Logistics companies are innovating on the last phase of the supply chain. They work on moving goods from a local retailer to a consumer’s home. Some example companies in this category include Instacart, DoorDash, Bigbasket, and Deliveroo.

Conclusion: Marketing Platforms and Last Mile Logistics Lead the Sector

The graphics above show that Marketing Platforms leads the sector for having the most companies and being a Heavyweight relative to other categories. The Last Mile Logistics category leads the sector for having the most funding.

What are your thoughts on this? Let us know in the comments section below.

To learn more about our complete Retail Technology report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.

AI Sector Maturing As Funding Shifts to Later Stage

Last quarter we saw that Artificial Intelligence (AI) funding grew exponentially in 2017. This quarter we are going one level deeper on our AI research platform to examine its funding by round. From our analysis we can conclude that the AI sector is maturing.

This conclusion comes from two takeaways:

  • Funding amounts are shifting to mid and late-stage events
  • Later-stage funding counts increased while early-stage funding counts dropped

We’ll explain these takeaways with some graphics that show AI funding activity by round.

To help set the stage, the graphic below illustrates AI funding amount over time. As you can see, the sector’s funding exploded in 2017.

Artificial Intelligence Annual Funding Amount
Artificial Intelligence Annual Funding Amount

AI Funding Amounts Shifting to Mid and Late-Stage Events

We’ll start off by examining the annual AI funding amounts. The below graph shows recent AI funding amounts in different rounds.

Artificial Intelligence Annual Funding Amount by Round
Artificial Intelligence Annual Funding Amount by Round

We see that AI funding amount for all stages grew from 2012 to 2017. Most notably, Series D funding grew the most.

Let’s look at the AI funding amount by round as a percentage, which shows changes independent of the total size.

Artificial Intelligence Annual Funding Amount Percentages
Artificial Intelligence Annual Funding Amount Percentages

From 2012 to 2017, Seed and Series A funding amount percentages dropped. During the same period, Series B, C, and D funding amount percentages increased.

Specifically, the Seed round funding amount dropped from 15% to 3% from 2012 to 2017. The Series A funding amount dropped from 40% to 20%. On the other hand, the Series B funding amount increased from 26% to 30%. The Series C funding amount increased from 15% to 25%. The Series D funding amount increased from 4% to 20%.

Taken together, these two graphics show that the AI funding amounts in Series B, C, and D increased from 2012 to 2017. The funding amount as a percentage graph also shows that the Seed and Series A funding dropped.

So we have seen the funding amounts graphs indicate a shift to mid and late-stage events. Would the funding event count graphs show the same trend? Let’s examine them in the next section to find out.

Later-Stage AI Funding Counts Grew; Early-Stage Funding Counts Dropped

Let’s now look at the annual AI funding event counts. The below graph shows the AI funding counts in different rounds over recent years.

Artificial Intelligence Funding Count by Round
Artificial Intelligence Funding Count by Round

The above graph shows that Seed round events grew from 93 in 2012 to its peak at 275 in 2015. It then fell from 275 events to 195 events in 2017. On the other hand, the funding event counts for all the other stages grew from 2012 to 2017.

Specifically, Series A funding events grew from 40 to 176. Series B funding events grew from 12 to 84. Series C funding events grew from 4 to 35. Series D funding events grew from 2 to 21. Late Stage funding events grew from 0 to 9.

Let’s now look at the AI funding count by round as a percentage, which can show shifts more clearly.

Artificial Intelligence Annual Funding Count Percentages
Artificial Intelligence Annual Funding Count Percentages

This graph shows that from 2012-2017, the Seed round funding count percentage dropped. In the same years, the funding count percentages for all the other stages increased.

Specifically, the Seed round funding count dropped from 62% to 38% from 2012 to 2017. In contrast, the Series A funding count increased from 26% to 34%. The Series B funding count increased from 8% to 15%. The Series C funding count increased from 3% to 6%. The Series D funding count increased from 2% to 4%. And the Late Stage funding count increased from 0% to 2%.

Combining these two graphics, we can see that the AI funding count for the Seed round dropped from 2012 to 2017. The funding counts for all the other stages grew by various degrees during the same period.

Conclusion: The AI Sector Is Maturing

In conclusion, we have seen that AI funding amounts have shifted to mid and late-stage events. AI funding counts also saw an increase in mid and late-stage events and a drop in Seed events. These observations led us to conclude that the AI sector is maturing. Investors seem to be placing heavier bets into more well-established AI companies.

What are your thoughts on this? Let us know in the comments section below.

To learn more about our complete Artificial Intelligence report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.

Payments Backend Leads Fintech Exit Activity

Last quarter we reviewed fintech exit trends and found robust growth. This quarter we went one level deeper on our fintech research platform and conclude that the Payments Backend category leads fintech exit activity. Companies in this category include technologies impacting payment issuers and acquirers, as well as the infrastructure enabling payments.

This conclusion was derived from three takeaways:

  • Payments Backend leads fintech in the number of exits
  • Payments Backend leads fintech in the acquisition amount
  • Payments Backend also leads fintech in the exit ratio

We’ll illustrate these takeaways with some graphics that show fintech exit activity by category.

To help set the stage, the graphic below shows fintech exit activity over time. As you can see, the sector is experiencing strong growth in exits.

FinTech Exits by Quarter - Stacked
FinTech Exits by Quarter – Stacked

Payments Backend Leads Fintech in the Number of Exits

We’ll start off by examining the exit events in each fintech category. Exit events include both acquisitions and IPOs. The below graph highlights the number of fintech exit events by category.

FinTech Exit Counts by Category
FinTech Exit Counts by Category

This graph shows that Payments Backend leads the sector with 55 exit events. Consumer Payments and Personal Finance come next, with 44 and 43 exit events.

Let’s now see how fintech categories compare with one another by acquisition amount.

Payments Backend Leads Fintech in the Acquisition Amount

The graph below shows the acquisition amounts in different fintech categories.

FinTech Acquisition Amounts by Category
FinTech Acquisition Amounts by Category

We can see from this graph that Payments Backend leads all the other fintech categories by far. The total acquisition amount in this category approximates $25 billion. It’s noteworthy that Payments Backend’s acquisition amount is more than twice the next category, Consumer Payments.

Payments Backend has seen some large acquisitions in recent years. Nets was acquired by Hellman & Friedman in September 2017 for around $5B. Bambora was acquired by the Ingenico Group in July 2017 for around $2 billion. Worldpay was acquired by Vantiv in July 2017 for slightly under $10 billion.

The acquisition amount in Payments Backend represents 31% of that across all fintech categories.

We’ve now seen the leaders in fintech exit activity by event count and acquisition amount. What about the ratio of exit events to the total number of companies in the category? Let’s look at the Exit Ratio by Category graph to find out.

Payments Backend Leads Fintech in the Exit Ratio

The graph below shows the total exits divided by total companies in fintech categories.

FinTech Exit Ratio by Category
FinTech Exit Ratio by Category

Payments Backend, Transaction Security, and Consumer Payments are the leaders in this metric. 24% of Payments Backend companies have been acquired or gone public. The same is true for 23% of Transaction Security companies and 21% of Consumer Payments companies.

Conclusion: Payments Backend Leads Fintech Exit Activity

In conclusion, we have examined fintech exit activity by exit events, acquisition amount, and exit ratio. Payments Backend is the category that leads the sector in all three metrics. Its abundance of exit activity indicates that it is one of the most mature and well-established fintech categories.

What are your thoughts on this? Let us know in the comments section below.

To learn more about our complete Financial Technology report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.

Blockchain Technology Sector Overview – Q1 2018

The Blockchain Technology sector has seen a lot of buzz in the news, as the price of cryptocurrencies has seen large ups and downs over the last year.

What are the different components of Blockchain Technology and how do they make up this startup ecosystem? On our Blockchain research platform, we have classified the companies into functional categories. This blog post examines these categories and how they compare with one another through a series of graphics.

Blockchain Innovations Is the Largest Category

Let’s start off by looking at the Sector Map for the Blockchain Technology sector. As of March 2018, we have classified 1,007 Blockchain Technology startups into 12 categories which raised $6 billion in funding. The Sector Map highlights the number of companies in each category. It also shows a random sampling of companies in each category.

Blockchain Technology Sector Map
Blockchain Technology Sector Map

We can see from the Sector Map above that Blockchain Innovations is the largest category with 244 companies. This category contains companies that are working on blockchain distributed ledger technologies. Examples include increased speed for financial transactions, smart self-enforcing contracts, and cross-blockchain interoperability. Some example companies in this category include Blockstream, Filecoin, Blockstack, and Ripple.

We have seen what the different categories in Blockchain Technology are and how many companies are within each category. What about their funding and maturity in relation to one another? Let’s look at our Innovation Quadrant to find out.

Blockchain Technology Categories Are Evenly Distributed Among the Four Quadrants

Our Innovation Quadrant divides the Blockchain Technology categories into four different quadrants.

Blockchain Technology Innovation Quadrant
Blockchain Technology Innovation Quadrant

We can see from our Innovation Quadrant above that the categories are rather evenly distributed among the four quadrants. The Pioneers quadrant has the most categories at 4. The Disruptors quadrant and the Established quadrant each have 3 categories. The Heavyweights quadrant has 2 categories.

We’ve now seen how the Blockchain Technology sector is categorized. We’ve also seen the relative stages of innovation for those categories. How do these categories stack up against one another in a holistic view? Let’s look at the Total Funding and Company Count Graph.

Blockchain Innovations Category Has the Most Funding and Company Count

The graph below shows the total amount of venture funding and company count in each Blockchain Technology category.

Blockchain Technology Total Funding and Company Count
Blockchain Technology Total Funding and Company Count

We can see from the graph above that the Blockchain Innovations category leads the sector in total funding at $3 billion. It also has the most companies in the sector at 244 companies.

Conclusion: Blockchain Innovations Leads the Sector

The graphics above show that the Blockchain Innovations category leads the sector in funding and company count. The other categories have large potential for growth and development in this nascent market. It will be interesting to see how this sector turns out in 2018.

What are your thoughts on this? Let us know in the comments section below.

To learn more about our complete Blockchain Technology report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.

Venture Scanner Sector Maps (Part 2 of 2)

Our sector maps are snapshots of emerging technology sectors. They show what the different categories in a sector are and how many startups are within each category. They also present a small sampling of the current startups that are innovating in each category.

Last week, we kicked off our sector map update with Part 1. You can read that blog post here.

This post is the second of a two-part series. Below you will find sector maps for Artificial Intelligence, Internet of Things, Marketing Technology, Real Estate Technology, Retail Technology, Security Technology, Transportation Technology, and Virtual Reality.

Artificial Intelligence: 13 categories, 2161 companies, $32B in funding

Artificial Intelligence Sector Map
Artificial Intelligence Sector Map

Internet of Things: 20 categories, 2151 companies, $52B in funding

Internet of Things Sector Map
Internet of Things Sector Map

Marketing Technology: 15 categories, 1771 companies, $33B in funding

Marketing Technology Sector Map
Marketing Technology Sector Map

Real Estate Technology: 12 categories, 1649 companies, $48B in funding

Real Estate Technology Sector Map
Real Estate Technology Sector Map

Retail Technology: 21 categories, 1746 companies, $59B in funding

Retail Technology Sector Map
Retail Technology Sector Map

Security Technology: 14 categories, 1063 companies, $25B in funding

Security Technology Sector Map
Security Technology Sector Map

Transportation Technology: 17 categories, 1238 companies, $117B in funding

Transportation Technology Sector Map
Transportation Technology Sector Map

Virtual Reality: 13 categories, 750 companies, $10B in funding

Virtual Reality Sector Map
Virtual Reality Sector Map

To learn more about our complete report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.