PostedOctober 29 2014 by VentureBeat
Mobile Internet companies raked in a totalof $19.2 billion in new investment over the last year, more than doublethe previous period, according to investment advisory firm Digi-Capital. Thebig winner? Mobile commerce, with $4.2 billion.
The good news is that not only are mobileentrepreneurs pulling in serious capital pre-exit, investors inpost-IPO mobile internet companies are achieving an average 28percent return on investment. On the positive side, that means that mobileinternet companies that have gone public are generally doing well. Onthe negative side, only nine of the 16 stock market sectorsDigi-Capital tracks generated positive returns for investors in the last twelvemonths.
So there are some clear winners — andlosers. Travel/transport is the highest performer, with a 78 percent return,followed by social networking at 45 percent. Navigation, a lower-volume buthigher-value sector, is getting returns of 43 percent on capital invested,while Messaging and Games are seeing around 40 percent. There are some apparentdogs, however. Utilities is seeing a negative 67 percent return, whileadvertising and marketing — a massively competitive sector with hundreds ofbattling players — is at negative 56 percent. App store and app distributionmechanisms are down 43 percent, and mobile commerce is down 22 percent.
It’s early innings, of course, and many ofthose numbers will change. Mobile commerce in particular is not only seeingmassive investment, it’s also a major component of a space that is projectedto hit $700 billion in revenue by 2017, and according to forecasts, willaccount for $500 billion in sales by itself. So it might be a bit too early towrite off any of the underperforming sectors just yet.
“There have been lots of big numbers already, but for Mobile Internet investors the best is yet to come,” Merel says. “Past success is not always a good guide for future investment in any sector, so the Digi-Capital Mobile Internet Investment Quadrant highlights opportunities where revenue outperforms investment activity.”
