Click on chart for the full list. Source: WSJ/Dow Jones Venture Source
Click on chart for the full list. Source: WSJ/Dow Jones Venture Source

It has been a great run for the Seattle tech community in the past 18 months, with spectacular IPOs (Tableau, NanoString and Zulily) and mega financing rounds (Apptio, Redfin and Juno Therapeutics).

But, as we all know in the tech industry, things can change fast. And you’ve got to make sure there’s a pipeline of activity and a group of up-and-comers emerging in line to be “the next big thing.”

Photo via Shutterstock
Photo via Shutterstock

In that regard, Seattle could use some help. A new analysis from The Wall Street Journal and Dow Jones Venture Source shows 37 privately-held tech companies that have joined “The Billion-Dollar Startup Club.” In other words, those that have achieved a valuation of $1 billion or more in their last round of funding.

Seattle, for all of its strengths, doesn’t have one company on the list.

Zero. Zilch. Nada.

And just so we don’t feel left out of the club, Boston too is lacking startups in the billion-dollar club. That may irk Fortune’s Dan Primack even more, who just last week penned a fascinating column dubbed “What’s really wrong with Boston tech?” (Just for the record, I don’t necessarily agree with Primack’s thesis that a strong tech media scene would help spark Boston innovation).

Not having any private Seattle tech companies in the club is a bit disconcerting, and worth pondering. Making matters worse, one of the Silicon Valley powerhouses that makes the list — Box — was started in Seattle 10 years ago by former Mercer Island High School grads Aaron Levie and Dylan Smith. The Los Altos, Calif.-based company now has an estimated value of $2 billion.

In fact, 21 of the 25 U.S. companies on the list happen to be based in California, from Dropbox to Jawbone to Beats Electronics. New York, the technology up-and-comer, shows three companies in the club by my count (Fab, Gilt Groupe and MongoDB) while Florida boasts one in Fanatics, the Jacksonville-based sports apparel online retailer.

So, where are the Seattle startups?

One could argue that the big ones have already graduated to IPO status, with Tableau and Zulily pricing shares last year at multi-billion dollar valuations and Zillow going public in 2011. But IPOs also have been occurring in the Bay Area with regularity, including companies such as Twitter, Workday, Rocket Fuel and FireEye.

That means one thing to me: Seattle just needs to work on the strength of its bench.

Comments

  • http://StartedinSeattle.com/ Stephen Medawar

    The Founder and CEO (Jason Goldberg) of Fab is also a Seattle native. Isn’t he?

    • johnhcook

      Not a Seattle native, but he did work here at T-Mobile and CEO of Jobster.

  • pjbackman

    Of course, this list omits unfunded startups. If you put Valve Software on that list, for instance, it would appear in top 10, easy, and possibly the top 5.

    • johnhcook

      Yep, that is a good point. There are some big home-grown successes that have not gone public or raised outside cash, like Valve. Also, Parallels comes to mind too.

  • The Dawg

    Who’s close? There are a bunch that must be close, like Avalara.

    • johnhcook

      Avalara is probably inching up there, but the closest in terms of venture-backed companies is likely Apptio. Its last round of $45 million came in at an uptick to the previous $600 million valuation that was set when it raised $50 million.

      http://www.geekwire.com/2013/apptio-raises-45m-hefty-valuation-plans-accelerate-on-fronts/

      Zulily was the last $1B or more startup left, and its IPO pushed it out of the club. (A good problem to have). It is now valued at more than $5 billion.

      That said, it would be nice to have a few more on this list or getting close, that’s for sure.

  • TomSchmitz

    A few Greater Seattle startups, were they in Silicon Valley, would have billion $ valuations and be far better known. Our politeness culture disallows arrogant public displays of hype so you don’t get overexcited VC partners clamoring to get aboard with inflated appraisals. Perhaps this region should reevaluate its marketing swagger.

    • johnhcook

      Tom,

      That’s the argument that Dan Primack made about Boston — basically that they needed to amp it up from a media and awareness perspective. I do think that is an issue to some degree in Seattle, but certainly not the overriding issue.

      I am not convinced that will drive more billion dollar valuations.

      At the end of the day, I think a tech ecosystem is driven by super smart entrepreneurs, developers, engineers, makers, VCs and doers … not hype.

      Frankly, I kind of like that Seattle produced 2 blockbuster IPOs last year that many in the Valley or NYC didn’t see coming, or didn’t care much about.

      A tech community built on hype, and fading trends, is not a good thing.

  • axiomflash

    Seems to me that the culture in Seattle is more conservative and risk-averse, and so we don’t make bit bets on radical ideas. Most of the billion-dollar startups are consumer apps – another area that Seattle lacks in. Few local investors are willing to bet on consumer.

    • stonezhong

      Doing consumer apps allows you to touch broadest audience which means you have the potential to grow at light speed, however competition is also intense, it is a high risk high reward game.

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