AngelList, a service that matches early-stage startups with investors, now includes a nifty tool that shows anonymous valuations of startups on the site. The feature was actually rolled out weeks ago, but hasn’t gotten much attention.
For background, AngelList is a hybrid social network, communication and crowdsourcing platform that allows startups to access investors, and has also become a resource for investors looking to boost deal flow and connect with other investors. The site currently has around 100,000 startup profiles, and has raised as much as $12 million in funding for startups through its network over a 30-day period.
AngelList also recently launched a new feature called AngelList Invest, which allows smaller, accredited investors the ability to put in $1,000 or more in a startup on the same terms as the company’s larger investors (via a partnership with SecondMarket).
All of these interactions mean that the network can do some interesting things when it comes to parsing through data. Valuations are particularly interesting because of the current reports that valuations of startups, especially at the early stage, are sky-high.
In its most simple form, the valuations tool allows you to see the average valuation of startups on the site. For example, currently, the average valuation is $3.8 million. AngelList CEO and co-founder Naval Ravikant explains that the data is exclusively for seed-stage companies, is anonymized and is sourced from the site’s done deals list, as well as featured startups with confirmed high quality investors. All valuations are post–2010.
What’s really compelling about the valuations feature is that you can actually start to filter by college, incubator, employer (i.e. Google vs. Microsoft), time, location and market (i.e. SaaS, games, health care). So, Y Combinator startups (according to AngelList data) have an average $6.1 valuation, and 500 Startups’ startups have an average $4.1 million valuation.
Startups founded by Googlers have a $5.1 million average valuations, whereas startups founded by Microsoft employees have an average $4 million valuations.
Ravikant says that AngelList filters out unconfirmed valuations (no investors committed and verified at that price), Series A or later as well as locations, markets and incubators where the startups have less than 4 data points. He cautions that the data is by no means complete, and the site is missing some key data.
But considering the whole Series A crunch, seed-investment explosion and valuations frenzy, AngelList’s tool provides a number of interesting insights.