2012 on track to be a big year in mobile exits

But Facebook IPO disaster has scared off other IPOs; could lead to slowdown for rest of the year

2012 is looking to be a big year for VC mobile exits so far, due to some big IPOs and acquisitions. If things continue on this path, 2012 could be one of the biggest exit years of the past decade. Of course, there is a trouble on the horizon in the form of Facebook, which threatens to take everything down with it. 

So far this year, while it's not even half over, has already seen over $6.5 billion in transactions, according to investment bank Rutberg & Co. on Monday.

That beats out every single year’s total transactions since 2001, except for 2007, 2010 and 2011. 2012 had already nearly matched 2010’s total.

Millennial Media’s $1.093 billion IPO, which doubled its stock price in its debut and Facebook’s $1 billion purchase of Instagram in April, were the two biggest exits of the year so far. So far, exits through mergers and acquisitions are far outpacing exits through IPO.

Behind Millennial Media and Instagram were Israeli flash memory maker Anobit, who was purchased by Apple for an unknown sum; voice-controlled patient communications maker Vocera, which had a $348 million IPO; and processing chip maker Audience, with their $330 million IPO, rounding out the top five.

Also in the top 10 mobile VC exits of the year were Zynga’s purchase of OMGPOP for $180 million and Gree’s acquisition of Funzio for $210 million.

There is a long way to go if 2012 is going to be anywhere as big as 2011, which saw over $15 billion in transactions, more than the previous three years combined.

Curiously, since 2001, when VC investment and VC-back exits were roughly the same amount, investments have pulled far ahead of exits, so that investments are over 50% higher than exits: 68 billion to 42 billion.

The Facebook effect

Absent from the list of mobile exits was Facebook, which had a $16 billion IPO, the largest ever for a tech company.

Despite not being included on the list, Facebook might just have the biggest impact of all on the rest of the year. Since its IPO became a giant disaster, causing lawsuits and investigations, other companies have suddenly become hesitant to go public.

At least 13 IPOs have been postponed since Facebook went belly up, including Kayak, Tria Beauty, Corsair Components, CyOptics, Graff Diamonds, Formula One, and Vkontakte, the largest social media website in Russia.

Bloomberg reported at the end of May that its IPO Index, which tracks companies for a year after they go public, declined by 15% that month. That wass the same decline the Index saw during the collapse of Lehman Brothers in October 2008, which many cite as the beginning of the current recession.

Just how big of a drag Facebook will be on IPO mobile exits for the rest of the year remains to be seen.

Rutberg & Co. did not return our request for comment

(Image source: apartmentadda.com)