The Knight Foundation with help from Quid is out with new data showing who invests in civic tech. CivSource has reported on the civic tech field since the beginning of the civic startup land rush, and even as long time watchers the report has a few surprises. Specifically, that civic tech and civic startups are getting more private capital backing than ever before. This is a notable shift from the reputation civic tech has for being an “impact” or philanthropic investment.
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So far $430 million in private capital has gone into the industry since January 2011, through the end of the study period – May 2013. The report itself is notable, as it is not only the first dataset that takes a deep dive into the financial backers in the industry, but Knight has also made the data machine readable, sliceable and diceable for public use.
“One of the reasons we did the analysis is because the field is opaque,” Jon Sotsky, Knight Foundation director of strategy and assessment, tells CivSource. “We’re inviting people to provide feedback on the data, and suggest improvements or additions for the next version of this study. We also wanted to foster collaboration within the industry, and among investors rather than just using the data as an internal report.”
An interactive map is available that provides visualizations of the data. The report reveals a 23% annual growth rate in the launch of civic tech companies since 2008. Even with this growth rate, better coordination is needed between private capital and philanthropic capital in terms of where and how to invest. “We noticed in looking at the data that startups dealing with voting issues, or what we call ‘tools of democracy’ issues are still vastly underfunded by private capital. So for us that could mean philanthropy still has a role to play there. Whereas peer-to-peer sharing startups are very well funded by private capital, so we may not have as big of a role to play with those efforts.”
“We may be able to help in other ways, like stepping into provide support around regulatory issues for these startups, the role of philanthropy here is evolving,” Sotsky said.
The Knight Foundation has provided backing to a significant number of open government and civic oriented startups through its open government grants. Besides the Knight Foundation, other prominent investors in the space include Omidyar Network, Google and Ashton Kutcher. Some of the organizations attracting the most funding include: Waze, a crowdsourced traffic monitoring app; NextDoor, a platform that connects people with their neighbors; Change.org, a site that allows users to create petitions for social change; and the Open Data Institute, which helps governments make their data more accessible.
The report also includes an index of investors and civic tech organizations, along with descriptions of the converging areas that make up civic tech—from information access and transparency to community organizing. The list is not exhaustive, but it is the first attempt to capture cohesive investment data for civic tech and analyze trends. Knight plans to follow-up with a repeat of the study next year.