It seems that the venture capital industry really has found a silver lining in the mobile and wireless industries, despite shrinking avenues of investments across other industry verticals. No really, it might be difficult to comprehend but this really is a good time to carve up a business plan, particularly if you creating a mobile app or creating a mobile payment solution.
Mobile Marketing, Mobile Ads, Everything Mobile
According to the 2011 review of venture capital in the mobile industry by research firm Rutberg & Co., 011’s investments topped up beyond $6.3 billion, up from $4.5 billion in 2010 and $2.1 billion in 2009. Mobile marketing/advertising garnered $592 million, up from $128 million in 2010, and mobile payments topped $558 million in investment, up from $276 million in 2010. The data definitely serves as a silver lining, and might be indicating a micro-level financial renaissance towards the latter part of 2012.
Rajeev Chand, MD and head of research at Rutberg, attributed the jump in VC investment in the advertising segment to the success of firms such as Admob, which Google acquired for $750 million in 2009 and Quattro, which Apple purchased for $275 million in January 2010. “Mobile ad budgets are still very small, but they are strong,” Chand said. “Investors are seeing the underlying revenue growth for ad startups.”
Mobile App Horizons Widening to Include Enterprise
The spur behind the VC interest and figures reading higher is that over the past year, more of the companies attracting investments are actually starting to earn revenue versus just attracting an audience. “Last year it was all about getting users and eyeballs,” Chand said. “Today some of these companies are getting a quality level of revenues…we are seeing some transition from eyeballs to revenues.”
Enterprise apps are starting to see some growth and Chand expects that this segment will attract more money in the next few years. “Enterprise apps are where the consumer app category was a few years ago. In 2011 it only represented $374 million but that was a big increase over $185 million in 2010.”