Mobile Monday Boston 2009 Investment Report

2009 Investment in Boston’s Mobile Industry March, 2010

Introduction In this report, Mobile Monday Boston evaluates the 100 Massachusetts mobile and wireless companies that saw activity in venture capital funding and acquisitions in 2009. The data reveals that mobile has now been billion-‐dollar a year sector in Massachusetts for the last two years, despite recent drops in venture funding fueled by the current economic climate. Yearly Mobile Investment Total mobile investment in the Boston area increased 44% from 1.01 billion in 2008 to 1.49 billion in 2009. Venture capital funding decreased from 565.28 million in 2008 to 338.65 million in 2009, while acquisitions increased from 473.4 million in 2008 to 1.16 billion in 2009. *2009 acquisitions include the following: • 72 Mobile Holdings’ $530 million acquisition of Airvana • Acme Packet’s $22.8 million acquisition of Convergence • Prime View International’s $215 million acquisition of E Ink • Compuware’s $295 million acquisition of Gomez • KPN’s $93.3 million acquisition of iBasis

The total number of Boston mobile companies receiving venture capital funding decreased to 32 companies in 2009 after reaching a new high in 2008 with 45 total companies receiving funding. This decrease is in line with the all investment activity (beyond mobile) throughout New England. Based on PricewaterhouseCoopers MoneyTree report for Q4 2009/Full-‐year 20091, the entire New England area experienced a 27% decrease in the number of venture deals from 474 in 2008 to 348 in 2009. Boston based mobile firms receiving funding mirrored that trend with a 29% decrease in the number of venture deals from 45 in 2008 to 31 in 2009. 1 Report can be found at https://www.pwcmoneytree.com/MTPublic/ns/index.jsp

Venture funding began strong for 2009 with 207.8 million invested in Q109, but quickly dropped off, bottoming out at 24.15 million in funding for Q309, and recovering with 40.2 million in funding for Q409. While Q3 was the lowest quarter for funding, we still saw eight total investments in this quarter, about the same total number of investments as all other 2009 quarters. The difference in Q3 was in the small size of VC deals. All but one was at or under $3 million. These venture capital investment numbers were overshadowed by several large acquisitions in the mobile space, with 237.8 million for Q209 and 918.3 million for Q409. These numbers combined for a total 1.16 billion in acquisitions for 2009, a 144% increase over the 473.4 million in acquisitions for 2008.

Percentages based on 32 total Boston firms receiving funding in 2009. While a variety of companies received investment in 2009, applications and hardware firms were among the most prominent categories, both with more companies receiving funding than all other sectors. The number of hardware firms receiving funding increased from four in 2008 to six in 2009, while the number of applications firms receiving funding increased from one in 2008, to five in 2009. Applications firms include companies like Apperian and Run Keeper; hardware firms include Ember Corp., IP Wireless, and Lilliputian Systems.

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Mobile Monday Boston 2009 Investment Report

by kateimbach on Mar 08, 2010

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Mobile Monday Boston 2009 Investment Report — Document Transcript