Figures compiled by SocialMediaAnalysis.com have revealed that companies in the social media analysis sector reported roughly $33 million in new investments in 2019, continuing a downward trend since 2015.
One single deal represents the majority of the year’s total, with Signal AI taking $25 million for geographic expansion and exploring new uses for its technology. Other investment activity was reported in relation to Lucidya ($1.1 million), New Knowledge – now known as Yonder – ($3 million), SocialFlow ($3.5 million) and TruFan ($400,000).
Jim Reynolds, Head of Global Alliances at Socialgist, said of the findings: “Big picture, these numbers indicate that this market is closing to new players. The investment market is clearly saying if you want to build a look-alike platform, you need to bootstrap because we’ve already funded five and haven’t gotten our investments back yet.
“Smaller picture, the shift from cheap-to-consume data to fully licensed sources is impacting the underlying metrics and margins for vendors. This is forcing them to either fund via debt/private equity and have a healthy business or differentiate their offerings to address a bigger market than just ‘social’.”
SocialMediaAnalysis.com recently revealed how merger & acquisition activity in the sector had also slowed slightly in 2019.