The fact that Amazon, Google and Facebook are not listed among the tech companies providing the highest return for investors comes as somewhat of a surprise. Likewise, the fact that the Top Ten features an extremely high proportion of Chinese companies should give us plenty of food for thought. China’s escalation is the main emerging trend highlighted by the Forbes Midas List 2018. So, which exactly are the top ten companies that in 2017 generated the greatest wealth for venture capitalists?
Despite being the most profitable company for investors in the last five years, Facebook has had to bow out of this year’s Top 10. The only company in Zuckerberg’s group to hang on in there is the WhatsApp messaging service, which continues its ascent and has recently launched a special business version of the app – with Jim Goetz, a partner at Sequoia Capital, benefitting significantly by the investment.
Top 3
While the online sales giant Amazon hasn’t made it into the standings, the world’s most profitable company is its Chinese competitor Alibaba. Since its $25bn IPO in 2014, the biggest in American history, Alibaba has always featured in the Top 3 of the Forbes Midas List. Investors include Anton Levy of General Atlantic, Neil Shen of Sequoia Capital and Scott Shleifer of Tiger Global.
Coming in second is the Uber carsharing service, which last year sold a significant stake of the company to the Japanese giant SoftBank. Word is that there may even be a merger looming with one of the three biggest transport companies in the world – the Chinese DiDi Chuxing, the Indian Ola Cabs and the Singaporean Grab – given that Softbank has shareholdings in each. The lowest step on the podium is taken by Uber’s Chinese alter ego DiDi Chuxing, which has recently secured $4bn in fresh funds, giving the company a staggering valuation of $56bn. DiDi Chuxing will invest this new capital in international expansion (into Mexico and Japan) and in developing technologies, such as artificial intelligence. The investment has generated significant yields for Scott Shleifer of Tiger Global and Allen Zhu of GSR Ventures.
China beats the USA
The ten most remunerative companies include Snap, the company behind Snapchat, and the hugely successful online marketplace and hospitality service, Airbnb, in which several members of the Forbes Midas List have invested: Joel Cutler of General Catalyst, Jeffrey Jordan of Andreessen Horowitz, Alfred Lin of Sequoia Capital.
And then there’s China, which simply steals the show. There’s Jd’s e-commerce, second only to Alibaba, which sees the backing of Mary Meeker of KPCB, Neil Shen of Sequoia Capital and Scott Shleifer of Tiger Global. There’s the low-cost smartphone manufacturer Xiaomi, now a full-scale electronics and software company. There’s China Internet Plus, also known as Meituan-Dianping, which develops and operates China’s greatest platform providing retail and online group buying services, with 20 million mobile users a day. China Internet Plus has recently collected funds for $4bn from a series of giants such as Tencent and Priceline. And then there’s Jinri Toutiao, the news aggregator app managed by Beijing Bytedance Technology, boasting over 700 million users. In April 2017, Jinri Toutiao collected funds for $1bn, giving the company a valuation of around $20bn. Its main supporters include Yi Cao of Source Code Capital and Neil Shen of Sequoia Capital.