Saturday, June 25, 2011

Social Media Received $2.52 Billion in Private Equity Funding in Q1

Unless you have been living under a rock, you probably know that private equity and venture capital firms have been pouring cash into social networks like it was their job (and apparently, it is). Until recently, however, it was hard to get a handle on just how much money was being invested in social media startups. That's no longer the case, thanks to a research outfit called Social Media Influence, which just released the SMI Guide to Social Media Funding.

$2.52 billion: that's how much venture capitalists and private equity investors plowed into social media companies in the first quarter of 2011, according to SMI, including $1.6 billion in social networks. Turning to other categories, SMI tallied $65.6 million in funding for social gaming; $420.2 million for social commerce; $110 million for social business; $62.6 million for social data analytics; $109.2 million for social marketing; and $146.1 million for social apps and tools.

In terms of specific companies, Facebook dominated the market with $1.5 billion in funding, accounting for the bulk of the "social network" category, but that still leaves another billion floating around for other companies. Altogether, aside from Facebook VCs closed a total of 55 funding deals in the first quarter, ranging from $377 million for Groupon down to a mere $1 million for Backtype.com. Some of the other big winners were Rovio, with $42 million in VC funding; Color, with $41 million; and Hubspot, with $32 million.

Writing in Ad Age, Bernhard Warner of Custom Communication and Social Media Influence pointed out that the $2.52 billion figure is especially impressive when you consider that total VC funding for all private firms in the first quarter came to $5.9 billion, meaning social media accounted for about 43% of all VC funding in this period. Warner also revealed that the second quarter is off to an equally rip-roaring start, with April bringing $1.35 billion in social media VC deals.
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Posted via email from SGB Media Group