Innovation continues to drive San Francisco’s economy. Even during 2021’s Covid shutdown, startups around the city attracted $61.2 billion in venture capital investment—more than double that of pre-pandemic 2019 levels, according to Pitchbook.
Big VC deals are seen as a “canary in the coalmine” for the hoped-for comeback of many businesses, both small and large, in the Financial District, SoMa and beyond. And commercial real estate firm JLL reports that venture-backed companies accounted for 52% of the leases of more than 50,000 square feet in the city during the fourth quarter of last year.
A Pitchbook analysis shows the San Francisco startup that received the biggest single round of funding in 2021 was not even a tech company. Generate Capital received $2 billion to fund sustainable energy infrastructure.
But tech would hold the top spot if the two rounds received by “data lakehouse” maker, Databricks, are combined. Digitally driven startups round out the rest of SF’s top 10 VC deals.
Will the millions and billions of venture dollars continue to flow into San Francisco in 2022? City Hall is counting on it, but the easy mobility among tech workers means there are no guarantees people will return to San Francisco offices. In fact, one of 2021’s top SF startups, Stripe, already moved its headquarters just south of the city limits.
Read on for more details about SF’s biggest venture capital investments of the past year:
1. Generate Capital - $2.0 billion
From its headquarters near the Embarcadero, Generate Capital finances, builds, owns and runs projects dedicated to clean energy and sustainable infrastructure. It’s whopping $2 billion round of funding was followed by a $1 billion round in 2020, and total funding of $10 billion, which supports more than 2,000 assets in the company’s project portfolio.
2. and 4. Databricks - $2.6 billion total
Databricks is an East Cut company that has attracted investors to its “data lakehouse,” a storage and artificial intelligence architecture that aims to make data warehouses a thing of the past. In December, it launched Databricks Ventures, a fund to invest in startups to help build out its ecosystem.
3. Chime - $1.1 billion
Chime is an online bank that boasts being a “member-first” company that doesn’t charge overdraft, monthly or miscellaneous service fees to boost its profits. Its latest round of funding hopes to position the Maiden Lane firm for an IPO in 2022.
5. Airtable - $735 million
Makers of a cloud-based collaboration platform for knowledge workers, Airtable’s $735 million funding round pushed the Mid-Market startup’s valuation to more than $11 billion.
6. Forte - $725 million
The San Francisco company is building a blockchain technology platform that aims to reinvent the economics of the video game industry, enabling players to pay for, own and trade assets as well as giving developers better payments, security and tax systems.
7. Hinge Health - $600 million
Based in the Financial District, Hinge is a digital musculoskeletal (MSK) clinic specializing in treating chronic back and joint pain and other chronic musculoskeletal conditions. Its $600 million round of funding in October makes it a major player in online health.
8. Stripe - $600 million
The good news? When Stripe closed its $600 million round last March, the payment processor was valued at $95 billion, making it the most valuable venture-backed company ever. The bad news? The company has since moved to South San Francisco.
9. Uber Freight - $550 million
As it does with riders and drivers of private cars, Uber Freight matches shippers with carriers for cargo deliveries around the world. In November, the subsidiary of the Mid-Market rideshare behemoth paid $2.25 billion in cash for Transplace to boost the shipping technology on its logistics platform.
10. Lime - $523 million
Based in SoMa, Lime provides the ride-sharing electric mopeds, scooters and bikes that move users around cities using a mobile-app membership platform. Though two years of Covid caused a drop in ridership, Lime hopes a post-pandemic reopening and this big round of financing will help push usage to new levels and prep the company for an IPO this year.
Additional research by Shelley Fargo.
Sequoia Capital Partner Michael Moritz is a co-founder and investor in The San Francisco Standard.