Hello!
We have created an infographic to give you an overview of the investments made in classified businesses over the past year. Last year we did the same research for 2014 and will compare the results to 2015.
Highlights
- At least 50 investments in classifieds businesses in 2015
- Almost $2 billion invested worldwide
- 34% of the investments were less than $1 million
- 20% of the investments were between $1 million and $10 million
- 18% of the investments were more than $10 million
These figures represent the investments in online classifieds businesses worldwide in 2015. From the remaining 28% of investments, the amount has not been made public.
Please click on the above image to see all the details. Each listing has the website name, logo, investment amount, operating location, language, and some other details about the deal. The data was gathered through screening articles posted online, checking company websites, blogs, and investment portfolios using whatever source we could find online. We tried to make it as accurate as possible but it could be that we have missed some. If you find any information that needs to be added or modified please let us know.
Business focus
The focus of the websites invested in varies from having a general classifieds business (biggest focus) to real estate (2nd biggest), jobs, automotive industry, students, restaurants, fashion, and more. Apart from the general classifieds businesses (34%), a lot of investments were made in real estate websites (28%) with amounts varying from $20k up to $23m.
Type of investment
Most of the investments were done after 1 or multiple funding rounds (external investors). This normally happens when a company shows steady growth after having passed the period of positioning itself in a market (often by selling stocks). However, they need capital to for example realize their growth plan even further. The infographic shows that 33% of the amounts invested after funding rounds were higher than $1 million. 29% did not make the amount public.
The second highest investment type was done via seed capital/angel investors. This one raised mostly investments with smaller amounts (> $1 million) as the capital is mostly generated by the founders, friends, or family to start the business and to cover initial expenses. In return, the investor will obtain an equity stake in the company.
The last type of investment used was venture capital (8% of total investments). Mostly invested in startups or small businesses that don't have access to capital markets. It could also include technical expertise which the founders might not have in the case of limited operating history. The only thing is that these investors often have a saying when making decisions, which might be a downside.
Comparison with 2014
| 2014 | 2015 | |
| Number of investments | 48 | 50 |
| Total invested amount | $2.800 million | $1.950 million |
| Investments < $1 million | 2% | 34% |
| Investments between $1 million and $10 million | 17% | 20% |
| Investments > $10 million | 60% | 18% |
Note: 21% of the investments didn't make the invested amount public in 2014. In 2015 this was 28%.
Out of the above table, we can conclude that more or less the same number of investments was made, but the total invested amount is much lower. If we compare the investment amounts per deal, we can see that in general, the amounts were lower in 2015 than in 2014. In 2014 60% of the amounts were greater than $10 million, in 2015 this percentage is 18%. However, the percentage of investments smaller than $1 million increased from 2% to 34%.
All of this is a positive sign because it shows that there is still a lot of interest in the classifieds market from investors. Also at the same time, you notice that millions and millions of dollars are not needed to set up or grow an existing classifieds business. After all, the lower the investment costs, the higher the investment returns.
Some last advice, there are aspects you don't have control over such as market changes and competitors, but you have direct control over cost. So the best thing is to keep the costs low as possible for investors!
