Some interesting data recently became available through Pitchbook and as I was going through it I thought, heck – why not share it with all of you. First things first, and no surprises, .COM is still king and I don’t want anyone reading this to think that I’m suggesting that startups are giving up on .COM. That isn’t happening.
What is happening is that more and more startups are looking at new gTLDs as a viable option and the adoption rate has more than tripled for Seed and Early Stage startups. Before I say anything else I know what you’re thinking, “gimme the data!” so here it is:
As you can see, adoption of new gTLDs grew the most in 2020 with Seed Stage startups which are companies raising anywhere from $500k – $5M. If you want to do a deeper dive into Seed Round size, this is a good read.
Also as you can see, new gTLDs are still a small part of the pie but at 7% in 2020 and pretty clean increases every year in Seed and Early Stage startups it’s not hard to imagine a future where 10% – 15% of startups are branding on new gTLDs.
I think what will continue to accelerate this trend is more successful established startup branding on new gTLDs, good examples include startups that are well on their way to unicorn status 🦄 like Compound.finance which is backed by two of the world’s largest VCs, Andreessen Horowitz and Bain Capital. Compound.finance has already raised over $33M so it’s safe to say their valuation is in the nine figure range.
Like I said in the beginning of this article, I don’t think this means startups aren’t just as excited about .COM as they’ve ever been. At the same time, it’s clear both startups and Venture Capitalists are becoming more comfortable with new gTLDs and that trend seems to only be picking up speed.