AngelList Buys Product Hunt, a Marriage of Two Beloved Silicon Valley Sites
Two of the coolest kids in Silicon Valley's startup scene are getting together. AngelList, a popular website for young technology startups to raise capital from wealthy investors, said it's acquiring Product Hunt, a must-read site for many entrepreneurs wanting to keep up with the latest apps.
AngelList Chief Executive Officer Naval Ravikant said the deal involved a combination of cash and stock, but he and Product Hunt founder Ryan Hoover declined to disclose the price or other terms. Ravikant said the tie-up would make AngelList not just a funding site but “the best place to launch products and find early customers.”
Each company is backed by several top tech investors. AngelList's includes Alphabet Inc. venture capital arm GV, Kleiner Perkins Caufield & Byers and Russian billionaire Yuri Milner. Ravikant, 42, was among those who invested $7.1 million into Product Hunt, along with Andreessen Horowitz, Cowboy Ventures and other backers.
As storm clouds formed this year over startup land, Ravikant began searching for new businesses to provide cover. He said in September that AngelList was looking to assemble a "rainy day" fund of $1 billion and that he's talking to investors outside the Valley to keep money flowing to U.S. startups. He's also been developing a sort of index fund for young, private companies, hoping the vehicle will appeal to a more mainstream investor.
The Bloomberg U.S. Startups Barometer, an index that tracks VC funding and deals, has dropped 15 percent from its high last year. Early-stage companies, which are the core audience of AngelList and Product Hunt, have gotten hit particularly hard. Many startups that raised seed funding during the boom of recent years are encountering a much tougher fundraising environment. The companies that manage to raise additional cash are having to clear more demanding performance goals than a year or two ago.
AngelList was founded in 2010, but the site really took off a few years later with the relaxing of rules around publicizing and soliciting for investments. The site typically takes 5 percent of the profits on any deal arranged through the site. It also has a job board.
Hoover, 29, became something of a startup power broker after the launch of Product Hunt in 2013. The site and newsletter highlight new software and internet services, and let their creators solicit feedback from peers. On any given day, visitors may find anything from work-automation software to a fleetingly popular messaging app like Yo. “We see a lot of opportunity in working with AngelList to help those great companies get funding,” Hoover said.