67pc of tech exits in 2013 came after seed or Series A financing

18 Mar 2014

While massive transactions like Facebook’s acquisition of WhatsApp are being given the mythological tag of unicorns (exits of more than US$1bn), close to two-thirds of tech exits came after the seed round or were ‘acqui-hires’ aimed at securing talent.

According to CB Insights data, 2013 saw 67pc of tech start-ups exit after either the seed or Series A stages.

It pointed out that while the headlines obsess about the WhatsApps and Twitters of the world, the reality is that most venture-backed start-up exits are smaller and far from being unicorns (tech companies that exit for more than US$1bn).

“While a portion of those went to acqui-hires of start-ups hitting the Series A crunch, the data is more likely a reflection of the venture capital power law, in which the best investments return more than the rest of the investments combined,” CB Insights said.

cb insights

Unicorn image via Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years