When Benchmark partners valued Friendster at $53 million back in 2003, they were definitely at the early innings of what would become a global phenomenon. Despite the amount of money that's flowed into Web 2.0 companies since that time, the capital pouring into this sector has yet to decline. In the first half of 2007, $464 million was invested in 101 Web 2.0 startups, up 7% from the same period a year ago, according to Dow Jones VentureOne and Ernst & Young. Interestingly enough, and not so surprising, the amount of investment outside the U.S. drove demand. In fact, the number of global Web 2.0 deals rose 14%, or twice as much as the U.S. According to the report, about one out of five Web 2.0 deals funded come from the Bay Area, down from 40% between 2002 and 2006.
Among the interesting trends to point out include the lower participation in Web 2.0 deals from venture firm Benchmark. The high-profile Silicon Valley outfit was the sector's top global investor in 2006, having participated in 16 Web 2.0 deals. In the first half of this year, Benchmark invested in three deals. Most of the Web 2.0 deals in the U.S. focused on enterprise applications, while deals in China and Europe had a very "distinct consumer bent," according to the report. And, the largest Web 2.0 deal in the first half of this year was the $30 million first round investment in n2N Commerce.
At Vator.tv, we're definitely seeing the number of Web 2.0 companies proliferate around the world. Here's a cute and fun video from an instant messaging company called Moji based in Sydney, Australia. Another Web 2.0 company from Sydney is Tangler.com. Friction.tv is a great new site based in London. Friction is a place where anyone can start a debate. In France, there is a site called Capital Risqueur, a Web television company for angels and entrepreneurs. One of my favorite videos comes from a Web 2.0 company in Rio de Janeiro, Brazil. It's called "Mobivideo - The content that goes with you."
Let me know which Web 2.0 companies you want highlighted or written about on Vator.tv.