enormous
Appetite for risk
Growth of the venture capital market and skyrocketed valuations
Pandemic has stimulated the boom in fintech and e-commerce industries, as consumers are going further online. The best confirmation of such a trend — is Amazon stock price over the last year, which illustrates the whole e-commerce market. At the same time, fintech has hiked with help of companies like Robinhood, Chime and Stripe.
New leaders
According to PitchBook data, in 2021 Stripe has unseated Elon Musk’s space company, SpaceX, to become the most valuable US venture-backed company with a valuation of $95 billion. At the same time, SpaceX also has increased its valuation up to $74 billion and was able to remain 2nd most valued startup in the United States.
The bronze goes to — Instacart, a food delivery company. In 2019 it was enough to have a $15 billion valuation to be in the top 3 startups which EpicGame was. While today Instacart has raised $790 million since July ‘19 and seen its valuation jump to $39 billion, five times its worth in 2018. The company became the most valuable grocery delivery company in the world.
Fintech mania
It’s already getting confusing, how many fintech startups there are. And it seems like half of them got a $1 billion valuation. Nevertheless, since 2019 the industry has changed dramatically. Fintech companies raised $44.4 billion in VC funding, capping a 10-year stretch of strong growth. Of all emerging technologies, fintech was one of the best-funded and fastest-growing sectors.
Neobanks are growing at the most extreme pace, led by Chime — a US online bank. In 2019 the company was valued at $1.3 billion, while today it's the 7th most valued startup with a $14.5 billion cap.
Not to mention Robinhood, the online brokerage company, which has stimulated the retail investing boom last year. According to CrunchBase, the company has raised an enormous $3.4 billion through venture funding and convertible notes since the beginning of 2021.
Crypto hype
Bitcoin price records have made venture capitalist bring attention to the companies working in the field. Rather than investing in volatile Bitcoin or Ethereum, some investors prefer to enter the growing market through venture investments.
Coinbase IPO valuations were hiked up to $100 billion, which created a massive hype for other cryptocurrency exchanges. Kraken with a $4 billion valuation is now selling with a 50% premium on private equity markets. RIT Capital Partners, formerly known as the Rothschild Investment Trust, has acquired an interest in the Kraken cryptocurrency exchange. RIT is expecting Kraken valuation to grow up to $20 billion. At the same time, the Binance coin exchange rate peaked at $650, which is approximately a 3200% increase since March 2020.
Therefore, venture capital investment in cryptocurrency and blockchain startups hit a record $3 billion in Q1 2021 across 239 deals, according to PitchBook data.
Edtech
The closure of schools and universities during the pandemic has made a positive effect on online education companies. According to PitchBook data, Investors poured $13.6 billion into edtech startups in 2020, up 172% from the previous year.
And now, Coursera, one of edtech’s best-known names, has capitalized on the excitement surrounding the sector by debuting on the NYSE and ending its first day of trading at a market cap of $5.86 billion. The company’s last private market valuation was $2.57 billion. Investors of the Global Technologies Private Portfolio fund were able to purchase Coursera in the pre-IPO stage.
The next widely know company in the field is Udemy, which has raised almost $75 million since the pandemic started. According to TechCrunch, the post-money valuation was about $2 billion.
Sure, there are other players on the market like MasterClass or Duolingo. Considering the global trend for online education, a growing number of platforms and Coursera IPO success many venture capitalists would be highly interested in investing in edtech private companies. Which could mean the only thing — hiking valuations in the education technology market.
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