SecondMarket on Tuesday released its online secondary trading data, revealing that it handled $268 million in private company stock transactions in the first half of 2011, a 75 percent year-over-year increase. In 2010, transaction volume totaled $153 million.
(Note: the company has updated total transaction volume for Q1 2011 to $156 million, a good bit more than the $115.4 million reported in May.)
Once again, consumer Web services and social media, which includes the likes of Facebook, Dropbox and Spotify, dominated private market trading, accounting for 87.6 percent of completed transactions. Business products and services made up 7.3 percent and retailing and commerce made up 5.1 percent.
As expected on the secondary market, ex-employees made up the vast majority of sellers in transactions (94.2 percent in the last quarter). For buyers, 62.0 percent were accredited individuals, with the rest sliced up between secondary funds, asset managers, hedge funds and more.
Like last quarter, Facebook, Twitter and Groupon ranked highest on SecondMarket’s list of private companies with the highest number of watchers. Rounding out the rest of the list are Zynga (which has filed its S-1 to IPO), Foursquare, Skype (which Microsoft bought for $8.5 billion), Yelp, Dropbox, Gilt Groupe and LivingSocial. Two names that used to be on the list--LinkedIn and Pandora--have since dropped off due to their recent public offerings.
Rising stars, which SecondMarket defines as those companies with the largest increase in watchers, included Kickstarter, PopCap (which EA just bought for $650 million in cash), SharesPost, LegalZoom and LendingClub.
Newbies, private companies that started the quarter with less than 10 watchers only to grow significantly by the end of the quarter, include SurveyMonkey, Coupons.com, Hipmunk, Justin.tv and YouSendIt.
It’s all so... bubbly.
If you want a good idea of the venture capital firms investing in the highest number of most-watched companies on SecondMarket, check out the graphic below. Sequoia Capital, Accel Partners and Union Square Ventures top the list, unsurprisingly.
Transaction volume for all of SecondMarket, which handles other alternative investments like bankruptcy claims and public equity, now totals over $750 million for more than 650 transactions completed since 2008.
This is the company's first fundraising since 2019 and brings its total capital to $103M
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Steven Loeb
Startup/Business
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SecondMarket is the marketplace for alternative investments. It has become the online destination for accessing market data, building your investor network and transacting in assets such as private company stock, structured products, public equity and bankruptcy claims. SecondMarket centralizes and simplifies secondary market activity by connecting buyers and sellers, and providing world-class market and operations expertise. Since 2004, SecondMarket has brought together more than 75,000 individuals and institutions and completed billions of dollars in alternative investment transactions. SecondMarket is a registered broker-dealer and member of FINRA, MSRB and SIPC. For more information, please visit www.SecondMarket.com.
Startup/Business
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Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweets. It is free to sign up. Users then follow other accounts which they are interested in, and view the tweets of everyone they follow in their "timeline." Most Twitter accounts are public, where one does not need to approve a request to follow, or need to follow back. This makes Twitter a powerful "one to many" broadcast platform where individuals, companies or organizations can reach millions of followers with a single message. Twitter is accessible from Twitter.com, our mobile website, SMS, our mobile apps for iPhone, Android, Blackberry, our iPad application, or 3rd party clients built by outside developers using our API. Twitter accounts can also be private, where the owner must approve follower requests.
Twitter started as an internal project within the podcasting company Odeo. Jack Dorsey, and engineer, had long been interested in status updates. Jack developed the idea, along with Biz Stone, and the first prototype was built in two weeks in March 2006 and launched publicly in August of 2006. The service grew popular very quickly and it soon made sense for Twitter to move outside of Odea. In May 2007, Twitter Inc was founded.
Our engineering team works with a web application framework called Ruby on Rails. We all work on Apple computers except for testing purposes.
We built Twitter using Ruby on Rails because it allows us to work quickly and easily--our team likes to deploy features and changes multiple times per day. Rails provides skeleton code frameworks so we don't have to re-invent the wheel every time we want to add something simple like a sign in form or a picture upload feature.
There are a few ways that Twitter makes money. We have licensing deals in place with Google, Yahoo!, and Microsoft's Bing to give them access to the "firehose" - a stream of tweets so that they can more easily incorporate those tweets into their search results.
In Summer 2010, we launched our Promoted Tweets product. Promoted Tweets are a special kind of tweet which appear at the top of search results within Twitter.com, if a company has bid on that keyword. Unlike search results in search engines, Promoted Tweets are normal tweets from a business, so they are as interactive as any other tweet - you can @reply, favorite or retweet a Promoted Tweet.
At the same time, we launched Promoted Trends, where companies can place a trend (clearly marked Promoted) within Twitter's Trending Topics. These are especially effective for upcoming launches, like a movie or album release.
Lastly, we started a Twitter account called @earlybird where we partner with other companies to provide users with a special, short-term deal. For example, we partnered with Virgin America for a special day of fares on Virginamerica.com that were only accessible through the link in the @earlybird tweet.
What's next for Twitter?
We continue to focus on building a product that provides value for users.
We're building Twitter, Inc into a successful, revenue-generating company that attracts world-class talent with an inspiring culture and attitude towards doing business.
