An Overview of 2015 Los Angeles Tech Fund Raises

Happy New Year! Part of planning for a strong new year involves taking a look back at the previous year’s work, something I did over the holiday break (well, in between bingeing on Mr Robot, Making a Murderer, The Big Short, multiple viewings of Star Wars, that is…).

And even though the official numbers aren’t in yet (I leave that to real bean counters while I focus on my marketing & consulting business), back of the napkin math reveals that 2015 was another strong year for fund raising among Los Angeles tech firms — $4.123 billion in raises, up from $3 billion in 2014.

Here’s a quick breakdown of how things looked, with the caveat that I might have missed a couple pieces — this data was pulled from headlines we accumulated at our site LA Tech Digest, matched up against info posted on Built in LA, and double-checked against numbers listed on Crunchbase.

A lot of the smaller / undisclosed raises were omitted for the sake of simplicity, and a handful of larger deals went down without publicly disclosing the size of the deal — so this is admittedly not the absolute definitive tally, but it is a quick means of noting where we are and where we’re going.

So yeah, if you notice any huge gaps or gaffes, feel free to let me know in the comments section, more than happy to edit & credit.

EXITS

Once the dust settles and the real numbers come out, 2015’s total Exits of $1.653 billion, a number not included in the Raises sum, is down from the nearly $6 billion in 2014 (which included Conversant ($2.1B), Internet Brands ($1.1B), Maker ($500M), AdColony ($350M), True[x] ($200M)) — but in the meantime, LA has built healthy businesses which will likely IPO in 2016 / 2017 (Snapchat, SpaceX, Honest, Dollar Shave Club).

2015 exits include LinkedIn’s acquisition of Lynda for $1.5 billion in April, just months after Lynda raised a $186 million Series B. Tinder parent co. Match raised $460 million in its November IPO. Collective Digital Studios ($83M, Germany’s ProSieben) and Riot Games (undisclosed, China’s TenCent) were both bought out by their international partners, and Shift was purchased by brand networks for $50 million.

Mobile Roadie (Intellectsoft), ParkMe (Inrix), Alpha Draft (FanDuel), and DivShot (Google) were all acquired for undisclosed sums, as was Hello Giggles, which was bought by Time Inc for a rumored $20 million.
FUNDS

This info is not included in the overall raise numbers, but shows a healthy influx of capital ready to be deployed by local VCs: University of California system (not LA-based, but UCLA weighs heavy in the system) announced its own $250 million fund late in the year; Greycroft raised $200 million for Fund IV; Mucker raised $50 million; Arena VC closed their first fund with $37 million; Science $20 million; and TenOneTen $18 million.

Wavemaker announced an undisclosed investment from noted VC Tim Draper, Cornerstone on Demand announced their Innovation Fund, and Crowdfunder and Start Engine are fully operational now that legislation has passed in order to open Equity Crowdfunding to the masses.

THE BIGGEST RAISES

The area’s biggest funding rounds include SpaceX, whose $1 billion Series E is easily justifiable given its $7 billion in future shipping contracts (and proof that the Falcon 9 could launch & land safely).

Snapchat raised a combined $538M across two Series E’s — who, despite being marked down from $20B to $16B, continues to be the social network / expression platform of choice among younger generations. Now it’s time to turn those users into dollars and deliver a more agency-friendly ad product.

Social Gaming Network (SGN, run by former MySpace head Chris DeWolfe) received $130 million from Korean investors Netmarble.

Honest Company’s $100M Series D portends a robust IPO for 2016, depending on how the public markets shake out.

Dollar Shave Club’s $90.7M Series D allows the company to continue to grow into more grooming lines, even as they face litigation from Gillette — a dismissable pain in the ass, but a sign of real success since the four year old DSC has taken a serious bite out of Gillette’s business.

Also of note were the number of companies receiving strategic investments from larger companies: Digitour (Viacom, $10M), WEVR (HTC, $10M), Jukin Media (Samsung, $2M), and TV4 (Sky TV, undisclosed).

And even though not technically LA-based (and therefore not included in the overall numbers), both Vice and Buzzfeed’s $200M+ raises will continue to fuel LA’s role as a content machine.

2015 RAISES by Levels

The funding levels break down as follows, which reflects LA’s continuing trend of lots of early-stage investment, with a handful of companies tapping into later-stage funding:

SEED / ANGEL: 48 raises for $112 million

SERIES A: 50 raises for $515.65 million

SERIES B: 21 raises for $579.15 million

SERIES C: 5 raises for $141 million

SERIES D: 5 raises for $344.7 million

SERIES E: 4 raises for $1.562 billion (most notably SpaceX’s $1B)

OTHER (Venture, Debt Financing, Convertible Notes, etc.):
39 for $869 million
2015 LA TECH CO FUNDING ROUNDS

SEED / ANGELS ROUNDS (sorted by size, numbers in millions)
PeerStreet 6.1
AlphaDraft 5
Mobcrush 5
Heal 5
Crew 32 5
Saucey 4.5
Conversion Logic 4
Pledgeling 4
HopSkipDrive 3.9
Lootsie 3.5
Service 3.1
Campus Steps 3
FEM Inc 3
Little Labs 3
Sense360 2.75
Airmap 2.6
HelloTech 2.5
Wag! 2.45
Virtual Reality Company 2.1
Ferris 2
Clutter 2
HelloTech 2
Reload Studios 2
Orbitera 2
Bringhub 2
Local ID 1.9
Incentive 1.8
MPulse 1.7
FAMA 1.5
Taints 1.5
Brilliant Bicycle 1.5
truBrain 1.4
GEM 1.3
Clutter 1.3
Skurt 1.3
Tuition.io 1.25
Tripscope 1.2
Fliptu 1.2
Ampsy 1.2
Taplet 1
Mixcord 1
Boon 1
Rayton Solar 1
Twigtale 1
Ledge 0.9
Camino Financial 0.75
PingTank 0.450

SERIES A (sorted by size, numbers in millions)
Thrive Market 33
NextVR 30.5
Patch of Land 23.6
DataScience 22
HomeHero 20
Soylent 20
Seriously 18
Service Titan 18
Aspiration 15.5
TaskUs 15
VideoAmp 15
Managed by Q 15
OpenHouse 13.5
HelloTech 12.5
Honk 12
Hollar 12
Reformation 12
AssetAvenue 11
Mobcrush 11
Soothe 10.6
Fuisz 10
Inventure 10
PatientPop 10
Omaze 9
Cluttter 9
Cargomatic 8
Prevoty 8
Twenty20 8
Vadio 7.5
Kaleo 7
Two Bit Circus 6.5
Science 37 6.5
New Matter 6.5
Chewse 5.9
Ring 5.5
Iris.tv 5.3
Tuition.io 5
Panjo 4.6
DataScience 4.5
Laurel & Wolf 4.4
EverSport 4.2
Reload Studios 4
17hats 4
Enervee 3.7
FabFitFun 3.5
VidMe 3.2
Stanson Health 3
Nestigator 3
Silversheet 2.9
Tapiture 2.75

SERIES B (sorted by size, numbers in millions)
Lynda 186
Flipagram 70
RealtyMogul 35
Factual 35
Tradesy 30
Ring 28
Hyperloop Technologies 26
The Black Tux 25
Laurel & Wolf 20
TicketManager 20
Nativo 20
Moviepilot 16
Bottlenose 13.4
MD Insider 12
ChowNow 10
Who What Wear 8
SoleSociety 8
Chargebee 5
MiTu 5
ZenEdge 4
MomentFeed 2.75

SERIES C (sorted by size, numbers in millions)
TigerText 50
WhipClip 40
GumGum 26
Nasty Gal 16
Card.com 9


SERIES D (sorted by size, numbers in millions)

Honest 100
Chrome River 100
Dollar Shave Club 90.7
Tastemade 40
Mojix 14

SERIES E (sorted by size, numbers in millions)
SpaceX 1000
Snapchat 338 (June)
Snapchat 200 (February)
Machinima 24

OTHER (Venture, Debt Financing, Bond Sales, Convertible Notes, etc. — numbers in millions)

NantHealth 200
Zest Finance 150
SGN 130
Azubu 60
Access Integrated 50
Steelhouse 49
Headspace 34
Goldstar 20
3PL Central 17.5
Vixlet 16
MediaPlatform 12
Filmtrack 10
uBeam 10
Ouya 10
WEVR 10
DigiTour 10
Marketshare 8
Scorebig 7
ONcam 7
Text Plus 7
MeUndies 5.7
Quickly 5
Vision Fleet 5
Fahlo 5
VC Mobile Ent 4.5
PetNet 4
Parachute 3.75
uBeam 2.6
InstaBrand 2.5
Lootsie 2.2
LottoInteractive 2
Jukin 2
Fanbread 1.9
WiserCare 1.7
Unitas Global 1.6
RealtyMogul 1.2
StyleBee 1

EXITS (numbers in millions)
Lynda 1500
Collective Digital Studios 83
Shift 50
Hello Giggles 20 (estimated)

KEY TAKEAWAYS:

Overall funding of LA startups hit $4 billion in 2015 — up a solid 25% from 2014’s $3 billion.

2015 Exits were down significantly from 2014 ($1.6B v $6B ($8B if you include Facebook’s 2014 acquisition of Oculus)), but a handful of honest-to-God, revenue-generating companies could go public in 2016 / 2017 (Snapchat, Honest, Dollar Shave Club, SpaceX).

LA is still an early-stage investing kind of town, but a larger influx of capital will allow local VCs to put more money into viable businesses.

And because the relative size of LA’s available capital over the years, VCs will continue to be a lot more cautious in where / how much they invest, compared to their neighbors to the north.

LA is not immune to macro economic issues, but current funding levels show that no one is going to be impaled by falling unicorns — however, Snapchat must (and will) figure out how to match agency-friendly ad programs to their massive, growing user base.

So there you have it — here’s to a healthy & happy 2016. Did we miss anything? Feel free to leave notes in the comments section thank you.

Author Description

Scott Perry -- LA Tech Digest founder

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