VC ownership at exit
When tech companies exit by going public, how much of the company is owned by venture investors at that point? We looked at 199 tech IPO’s to find out. The data is below.
Our big take-aways are below.
Venture owns ~50%. Venture and other major investors own on median 53% and on average 52% of the businesses that exit by going public.
Some VC have the Midas Touch. A number of VC pop up repeatedly in different deals. For instance, Bessemer, Sequoia, Benchmark, Insight, and Accel are each in multiple deals. There is a reason funds like these can raise billions of dollars, and it’s because of the success of the entrepreneurs they invest in. Sequoia and Benchmark lead the pack, listed in 23 and 18 IPOs respectively.
Strategics don’t matter. Of the 199 tech companies that have gone public, only 31 had a strategic investor. That’s only 16% or less than 1 in 5.
Founders owned 15%. Although we don’t show the data above (that’s a different blog coming tomorrow), founders owned on median 15% and on average 20%.
Sammy is the Managing Partner and Co-Founder of Blossom Street Ventures. Visit us at blossomstreetventures.com and email directly at email@example.com. We invest in companies with run rate revenue of $3mm to $30mm, with year over year growth of 20% to 100%+ depending on revenue. We lead or follow in growth rounds and special situations like inside rounds, small rounds, rushed rounds, corralling investors with our term sheet, cap table clean up, and extensions. We can commit in 3 weeks and our check is $1mm to $4mm. Also visit https://blossomstreetventures.com/metrics/ for always up-to-date SaaS metrics.