Investors are always chasing the “next big thing” in technology. And now The Wall Street Journal has created a list of its picks of those venture-backed companies poised for the big leagues.
Will some crash and burn? Undoubtedly.
But after considering nearly 6,000 companies, here are the top 50 startups that The Wall Street Journal editors believe have the the best chance at success. (Full list here).
Interestingly, Seattle area companies are well represented on the list. And there’s a weird food connection, too.
Among those who made the cut on the third annual list: Online humor network Cheezburger; domain name registrar Donuts; and electronic signature platform DocuSign.
Cheezburger’s Ben Huh (ranked 28th on the list) is quoted in the accompanying story in the Journal touting the company’s well-known mission to “make the world happy for five minutes a day.”
Donuts, formed last year by eNom founder Paul Stahura and backed with more than $100 million, is among the youngest companies represented. It ranked 14th on the WSJ’s list. (Interestingly, Donuts was the subject of a critical piece in The Washington Post earlier this week).
DocuSign, with offices split between Seattle and San Francisco, also is heavily funded. It raised a $55.7 million venture capital round from Google Ventures, Ignition Partners, Kleiner Perkins Caufield & Byers, Accel Partners, Comcast Ventures, SAP and Frazier Technology Ventures last year. The Keith Krach-led company ranked 6th.
In order to make the list, companies had to be based in the U.S., have received equity financing in the past three years and be valued at less than $1 billion. (That knocks out companies like Twitter, Dropbox and Box).
Given those metrics, it was a bit surprising to me that Seattle area companies Zulily and INRIX didn’t make the cut. Neither are that well known, but both are growing like gangbusters.
Both raised big venture rounds last year — Zulily pulling in $43 million at a valuation around $750 million and INRIX attracting $37 million at an undisclosed valuation. SEOmoz, which pulled in $18 million earlier this, also is a company on the rise (as we reported yesterday they’ve got ambitions to become a publicly-traded company).
Perhaps not surprisingly, the vast majority of the companies on the list are based in California and operate in the information technology category.
Thirty five of the 50 hail from California, most from Silicon Valley, including top 10 companies like Tabula, SpiderCloud Wireless, NueroPlace and Prosper Marketplace. The No. 1 company, Genband, is a 13-year-old Frisco, Texas maker of voice-over-Internet technology.