After releasing the 2011 Digital 100 list in late September, we received a lot of feedback.
As usual, we have now revised the list based on this feedback, and added 15 more worthy startups.
Here's the updated list...
Welcome to the Digital 100: The World's Most Valuable Internet Startups!
In this year's list, we've looked at and evaluated more than 300 startups and ranked the top 100.
So what are the 100 most valuable digital startups in the world?
Facebook tops our list again, with a valuation of $80 billion, up radically from $25 billion last year and $6.5 billion the year prior. Facebook continues to grow at a tremendous clip and now has more than 750 million users worldwide. The company reportedly earned $500 million on $1.6 billion in revenue during the first half of 2011 and is on track to do more than $4 billion of revenue for the year.
Rounding out the top five: Zynga, the social game developer; Groupon, the daily deals site; 360Buy, the Amazon of China, and Twitter, the massive microblogging network.
Click here to scroll through the Digital 100 →
About The List
We've been valuing and ranking the world's most valuable digital startups for the last 4 years. We started with 25 companies, and this list soon expanded into the SAI 50+. Now it's the Digital 100.
This year, we've expanded our search and analysis yet again. We found a ton more companies that are earning a lot of money and / or growing their businesses rapidly. The result is this year’s new and improved "Digital 100" — 100 of the world's most valuable private digital startups.
Notable companies not included on
last year’s list include Airbnb, the apartment rental service, and Rovio, the maker of Angry Birds, and dozens of others.
What's New
It's been a crazy year for technology companies. Many of the top companies from last year's list have gone public, like LinkedIn and Pandora. Many others, like Groupon and Zynga, have filed to go public. A lot of young companies are receiving wild valuations. Some of last year's leaders have stumbled and fallen.
Methodology
We used the same valuation methodology as have the last three years, which you can read about in detail here. Obviously, our valuations are only as good as the information we have, so please feel free to comment in the post or send an email to zlichaa@businessinsider.com.
The Digital 100 Top Ten:
1. Facebook
2. Zynga
3. Groupon
4. 360Buy
5. Twitter
6. Dropbox
7. Wikipedia
8. Vente-Privee
9. LivingSocial
10. Craigslist
Complete Coverage
Acknowledgments
We want to thank the hundreds of readers, companies, investors, and executives who have taken time over the past few months to submit nominations and share information with us. We thank our colleague Zach Lichaa for performing most of the background research. In addition, we thank our generous sponsors Buddy Media and NYSE for making the project possible. The valuations were estimated by Henry Blodget, Alyson Shontell, and Nicholas Carlson. Sharespost also aided some of the valuations. For a complete Sharespost index, click here.
Related
- Want to know what it's like working for one of the world's most awesome startups? Employees tell all.
1. Facebook
Estimated Value: $80 billion
Last Year's Rank / Valuation: #1 / $25 billion
Business: Facebook is the largest social networking site in the world with more than 750 million users, up from 500 million users last year.
Location: Palo Alto, California
More Info: About Facebook
CEO: Mark Zuckerberg
Investors: Earlier this year, Facebook closed a $1.5 billion round of funding that valued the company at more than $50 billion from Goldman Sachs, some of Goldman's international clients, and Digital Sky Technologies. Before that, the company had raised more than $400 million in funding since 2008. Microsoft ($246 million), Hong Kong billionaire Li Ka-Shing ($60 million), Greylock Partners and Meritech Capital Partners ($25M), Accel Partners ($12.8 million), PayPal co-founder Peter Thiel ($500,000), European Founders Fund ($15 million), Digital Sky Technologies ($200 million) and TriplePoint Capital ($100 million).
Sharespost Index
Analysis: Even though revenue numbers leaked earlier this year were lower than expected, Facebook is still growing very rapidly. An anonymous source told Reuters that Facebook earned $500 million on $1.6 billion in revenue during the first half of 2011. That's about twice as much as it earned and booked during the first half of 2010.
Shares are trading as high as $80 billion on Sharespost, at approximately the same level where they've been trading for the past 6 months. This is about ~60X this year's projected earnings and 20X revenue. These are high multiples, and for this valuation to be sustained, the company will have to continue to grow extremely rapidly.
2. Zynga
Estimated Value: $11 billion
Last Year's Rank / Valuation: #2 / $5 billion
Business: Social Gaming
Location: San Francisco, California
More Info: About Zynga
CEO: Mark Pincus
Investors: Zynga has raised a total of $510 million. Series A ($10 million): Avalon Ventures, Clarium Capital, Foundry Group, Pilot Group, Union Square Ventures, Reid Hoffman, Peter Thiel, Bob Pittman, Andy Russell, Brad Feld, Series B ($29 million): Kleiner Perkins Caufield & Byers, Union Square Ventures, Institutional Venture Partners Foundry Group, Avalon Ventures. Series C ($180 million): Andreessen Horowitz, Tiger Global, Digital Sky Technologies and Kevin Rose. Series D ($300 million): Softbank and Google.
Sharespost Index
Analysis: Zynga has established itself as the standout leader in social gaming. CityVille alone has more than 100 million daily active users. Empires and Allies, which was release this summer, gained 10 million users in 9 days.
The company is on track to generate about $1.5 billion of revenue this year (extrapolating from its S-1 filing), from a combination of ads and virtual goods. This is up from $597 million last year. The company's operating profit on this revenue is still low--about 10% of revenue--but this margin will presumably expand as the company gains scale. We use a multiple of 7X revenue and arrive at a valuation of about $11 billion.
Zynga lives primarily on social networks like Facebook where people are spending incredible amounts of time. Finally the virtual goods model is a high-margin business. Shares are trading as high as $11 billion on Sharespost.
3. Groupon
Estimated Value: $10 billion
Last Year's Ranking / Valuation: #11 / 2 billion
Business: Daily deal website that sells "groupons" to users - the discount is only valid if a certain number of people sign up.
Location: Chicago, Illinois (with a growing office in Palo Alto, California)
More Info: About Groupon
CEO: Andrew Mason
Investors: $1.14 billion in total venture capital raised. Angel round ($1 million): Eric Lefkofsky, Brad Keywell. Series A ($6.8 million): New Enterprise Associates. Series B ($30 million): Accel Partners, New Enterprise Associates. Series C ($135 million): Digital Sky Technologies, Battery Ventures, Accel Partners, and New Enterprise Associates. Series D ( $950 million): Digital Sky Technologies, Morgan Stanley Venture Partners, Fidelity Ventures, Andreessen Horowitz, Battery Ventures, Greylock Partners, Kleiner Perkins Caufield & Byers, Maverick Capital, Silver Lake Partners, Technology Crossover Ventures. Unattributed ($16.2 million): Peter Barris, Ted Leonsis
Sharespost Index
Analysis: Groupon began the year strong when it turned down a $6 billion buyout offer from Google in December. Since then its road to an IPO has been bumpy. The SEC was investigating the company after a detailed memo about its business was leaked to the press during the "quiet period," but now the IPO roadshow is said to be back on.
Groupon is on track to generate revenue of more than $3 billion this year, up from $760 million last year, extrapolating the numbers in its S-1.
Groupon has invented a new form of marketing that has become as much a part of everyday advertising and commerce as classified ads used to be. Groupon has been so wildly successful that, in the space of a year, more than 100 Groupon clones have sprung up to capitalize on the "daily deal" concept. In recent months, however, many concerns about the Daily Deal model have arisen, and some are speculating that Groupon's years of rocketship growth will soon be behind it.
Given the company’s market lead and continued user growth, we give Groupon a 3-4X multiple on revenue for a valuation of $10 billion. Shares have sold at a valuation as high as $14.9 billion on Sharespost.
See the rest of the story at Business Insider