For Forbes’ second annual list of next billion-dollar startups, we’ve found 25 companies that are transforming their industries and showing tangible results. They’ve already attracted tens and in some cases hundreds of millions in investment capital while in the midst of explosive growth.
We put together the list with the help of TrueBridge Capital Partners, a nine-year-old venture firm in Chapel Hill, NC, that also collaborates with Forbes on our annual Midas list of the world’s top tech investors. TrueBridge asked 180 venture firms to nominate startups and to encourage their portfolio companies to nominate themselves. It also fielded entries directly, through a link that appeared on its website and on Forbes.com. To be considered, firms had to give TrueBridge their revenue numbers, their most recent valuations, a list of investors, data on their customers and an outline of their business model and growth trajectory. TrueBridge examined more than 100 companies, then passed a list of 50 to the Entrepreneurs team at Forbes. We did further reporting and analysis, examining companies’ track records, evaluating business plans, and talking to founders, investors, customers and competitors. We also gave TrueBridge an additional 20 companies to evaluate. The list is confined to U.S. startups.
After much winnowing, we think we’ve come up with a fascinating group of companies we’re confident are heading toward billion-dollar status.
Not surprisingly, many of the companies are straight technology plays, like Fuze, a fast-growing competitor in the “unified communications” market, helping companies consolidate voice, video and digital messaging data in the cloud, and Sisense, which sells big data analytics software to customers like General Electric and Target. Others are using technology to tackle broader challenges, like Boxed, a Costco for millennials that lets customers order bulk-sized packages through its mobile app, and Guardant Health, which sells a two-year-old “liquid biopsy,” a blood test for cancer patients who want to avoid the pain and risk of invasive tumor biopsies.Keep reading for our complete list of 25. The companies aren’t ranked. We’re presenting them in alphabetical order and we’re including links to more in-depth posts on 10 startups on the list.
BitSight Technologies
Founders: Stephen Boyer, Nagarjuna Venna; Equity raised: $95 million; Estimated 2016 revenue: $30 million; Key investors: Globespan Capital Partners, Menlo Ventures, GGV Capital
What it does: Uses complex algorithms to produce a daily security rating that is akin to a credit score for cyber-security. Since its 2011 founding, it has signed up more than 450 companies, including Ferrari, Hess and Lowe’s. It’s based in Cambridge, MA.
Boxed
Founders: Chieh Huang, Jared Yaman, Christopher Cheung, William Fong; Equity raised: $133 million; Estimated 2016 revenue: More than $100 million; Key investors: DST Global, GGV Capital
What it does: Offers direct delivery of bulk-sized packages that its customers order via app or online. Since opening in a suburban New Jersey garage in 2013, the New York-based company has increased revenue to more than $100 million this year from $8 million two years ago. “Consumer packaged goods are one of the biggest drivers of the economy, and are only 1.5% online,” says CEO Huang, 35. “How crazy is that?” For an interview with Huang, see here.
Checkr
Founders: Daniel Yanisse and Jonathan Perichon; Equity raised: $50 million; Estimated 2016 revenue: $150 million; Notable investors: Accel, Y Combinator
What it does: Sells background checks to the likes of Uber, Instacart and Warby Parker. San Francisco-based Checkr delivers its reports in the form of an API, or application programming interface, which connects to companies’ hiring system software. Founded in 2014, it already has more than 4,000 customers and 90 employees. Founders Yanisse, 28, and Perichon, 26, are natives of France who got the idea for Checkr while working at Deliv, an on-demand delivery service in Palo Alto, where they had to run background checks. “I was really struck by how bad their technology and user interface was,” says Yanisse. “I thought, we can do better than that.”
ClassPass
Founders: Payal Kadakia, Mary Biggins, Sanjiv Sanghavi; Equity raised: $84 million; Estimated 2016 revenue: $180 million; Key investors: Google Ventures, General Catalyst Partners, Thrive Capital
What it does: Allows subscription customers to sign up for unlimited classes in everything from Pilates, cycling, boxing and boot camps to aerial yoga, pole dancing and underwater spinning via an app. Now in 31 U.S. cities and eight others across the U.K., Canada and Australia, the model has proven immensely popular, with more than 20 million classes booked to date. CEO and cofounder Kadakia, 33, a classically trained Indian dancer and MIT grad, got the idea for the company in 2010 after spending hours online searching for a good dance class in New York City.
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