Looking back at Philly Tech News' "Young Companies to Watch" from Spring 2013, and starting an update

Tom Paine

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I am starting to update Philly Tech News' "Young Companies to Watch." Actually, its hardly an update, since the last version was published in Spring 2013. But in a way it makes it even more interesting to look back and see what has transpired since then.


I explained that the criteria I used back then was to find any data points I could use to make some guesses as to what a startup's market value might be. And I ranked the companies based on these rough estimates. No science to it, though I know valuation techniques reasonably well. In a few cases I knew an exact valuation (based on a reported transaction), and in a few cases I had virtually no data but went with my gut that a company was on to something good. But they were mostly just informed guesstimates on my part.

As I start the revision, I am seeking input. The pool of credible startups has increased greatly, and I don't know the new wave of the past couple of years as well as I'd like to. So don't hesitate to email me at phillytechnews@gmail.com

Young

Companies

To Watch


(Originally posted May 28, 2013)

After considerable delay (it took me longer to put this together than I anticipated) here is my updated, revised and expanded (to 41 companies, actually, from 30 previously) Philly Tech News "Young Companies to Watch".

Rankings reflect a general, though by no means precise, estimate of relative market values based on revenue or profits when reported, growth, invested capital and reported valuation points, and a scattering of any other data points and inferences that I could gather. Also I look at non-quantitative indicators such as a startup's intellectual property, the track record of its leadership, and evidence of market acceptance.

The depth and quality of these Philly-area startups, I believe, is much stronger than in the past, and there many other excellent startups not on this list but are included on the bench (see others to watch). And then there is a entirely different tier of earlier-stage startups that others in Philly area have compiled information on.

This is not a revenue-driven list; relative market values may vary greatly from revenue comparisons according to the quality of a company's intellectual capital, its market acceptance, and its long-term potential for growth and profitability. There are many other excellent consulting firms and agencies, but for this purpose I focus on product-driven businesses.

Each company is privately held (though publicly traded corporations may hold a minority interest in some, and InsPro Technologies has a small public float but most of its value is in its non-listed preferred shares) and has an official headquarters or co-headquarters in the broader Philadelphia region. All of these companies' strategies are largely driven by proprietary information technology.

At the least, the top five companies (SevOne, iPipeline, InstaMed, Quintiq & Monetate) may have the potential to become IPO candidates if they do not have some other exit first. Another notable trend is the strength in the insurance software space, which appears to be booming. iPipeline, InstaMed, InsPro Technologies, Unirisx and Adaptik are all represented, and there is also Adminovate which is not included here now but may be soon.

I update these rankings on a regular basis as new information becomes available, and welcome input or insights that that might enhance their accuracy.

Congratulations to Philly Tech News' Young Companies to Watch.


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